New Lifetime High Reached: HD Supply Holdings (HDS)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified HD Supply Holdings ( HDS) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified HD Supply Holdings as such a stock due to the following factors:

  • HDS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $91.7 million.
  • HDS has traded 28,485 shares today.
  • HDS is trading at a new lifetime high.

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More details on HDS:

HD Supply Holdings, Inc. operates as an industrial distributor in North America. HDS has a PE ratio of 27. Currently there are 9 analysts that rate HD Supply Holdings a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for HD Supply Holdings has been 1.8 million shares per day over the past 30 days. HD Supply has a market cap of $6.8 billion and is part of the services sector and wholesale industry. Shares are up 16.6% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates HD Supply Holdings as a sell. Among the areas we feel are negative, one of the most important has been poor profit margins.

Highlights from the ratings report include:
  • The gross profit margin for HD SUPPLY HOLDINGS INC is currently lower than what is desirable, coming in at 29.22%. Regardless of HDS's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, HDS's net profit margin of 10.89% compares favorably to the industry average.
  • Looking at where the stock is today compared to one year ago, we find that it is higher, and it has outperformed the rise in the S&P 500 over the same period. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.
  • HD SUPPLY HOLDINGS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, HD SUPPLY HOLDINGS INC continued to lose money by earning -$0.03 versus -$1.15 in the prior year. This year, the market expects an improvement in earnings ($1.94 versus -$0.03).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Trading Companies & Distributors industry. The net income increased by 2116.7% when compared to the same quarter one year prior, rising from -$12.00 million to $242.00 million.
  • Net operating cash flow has significantly increased by 80.67% to -$23.00 million when compared to the same quarter last year. In addition, HD SUPPLY HOLDINGS INC has also vastly surpassed the industry average cash flow growth rate of 22.53%.

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