Potash Corp Of Saskatchewan (POT) Marked As A Barbarian At The Gate

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 Potash Corp of Saskatchewan ( POT) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Potash Corp of Saskatchewan as such a stock due to the following factors:

  • POT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $93.6 million.
  • POT has traded 8.9 million shares today.
  • POT traded in a range 241.5% of the normal price range with a price range of $1.16.
  • POT traded above its daily resistance level (quality: 26 days, meaning that the stock is crossing a resistance level set by the last 26 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in POT with the Ticky from Trade-Ideas. See the FREE profile for POT NOW at Trade-Ideas

More details on POT:

Potash Corporation of Saskatchewan Inc., together with its subsidiaries, produces and sells fertilizers and related industrial and feed products worldwide. The company operates in three segments: Potash, Nitrogen, and Phosphate. The stock currently has a dividend yield of 5%. POT has a PE ratio of 17. Currently there are 7 analysts that rate Potash Corp of Saskatchewan a buy, 1 analyst rates it a sell, and 10 rate it a hold.

The average volume for Potash Corp of Saskatchewan has been 3.6 million shares per day over the past 30 days. Potash Corp of Saskatchewan has a market cap of $25.6 billion and is part of the basic materials sector and chemicals industry. The stock has a beta of 0.38 and a short float of 1.4% with 3.70 days to cover. Shares are down 13.1% year-to-date as of the close of trading on Wednesday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Potash Corp of Saskatchewan as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Chemicals industry. The net income increased by 8.8% when compared to the same quarter one year prior, going from $340.00 million to $370.00 million.
  • 44.68% is the gross profit margin for POTASH CORP SASK INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 22.22% is above that of the industry average.
  • The current debt-to-equity ratio, 0.47, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that POT's debt-to-equity ratio is low, the quick ratio, which is currently 0.68, displays a potential problem in covering short-term cash needs.
  • POT has underperformed the S&P 500 Index, declining 18.79% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • Net operating cash flow has declined marginally to $521.00 million or 3.33% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

More from Markets

Apple and GE Switch Roles; Musk's Super Control of Tesla Explained -- ICYMI

Apple and GE Switch Roles; Musk's Super Control of Tesla Explained -- ICYMI

Trump May Be More to Blame For Higher Oil Prices Than OPEC

Trump May Be More to Blame For Higher Oil Prices Than OPEC

Dow Falls Over 200 Points as Apple's Slump Offsets Gains in General Electric

Dow Falls Over 200 Points as Apple's Slump Offsets Gains in General Electric

Week Ahead: Major Earnings on Tap as Wall Street Readies for Geopolitical Moves

Week Ahead: Major Earnings on Tap as Wall Street Readies for Geopolitical Moves

3 Hot Reads From TheStreet's Top Premium Columnists

3 Hot Reads From TheStreet's Top Premium Columnists