Barbarian At The Gate: Campbell Soup (CPB)

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 Campbell Soup ( CPB) 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 Campbell Soup as such a stock due to the following factors:

  • CPB has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $52.6 million.
  • CPB has traded 527,117 shares today.
  • CPB traded in a range 250.1% of the normal price range with a price range of $1.32.
  • CPB traded above its daily resistance level (quality: 7 days, meaning that the stock is crossing a resistance level set by the last 7 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 CPB with the Ticky from Trade-Ideas. See the FREE profile for CPB NOW at Trade-Ideas

More details on CPB:

Campbell Soup Company, together with its subsidiaries, manufactures and markets convenience food products. It operates through U.S. Simple Meals; Global Baking and Snacking; International Simple Meals and Beverages; U.S. Beverages; and Bolthouse and Foodservice segments. The U.S. The stock currently has a dividend yield of 2.6%. CPB has a PE ratio of 21. Currently there is 1 analyst that rates Campbell Soup a buy, 3 analysts rate it a sell, and 8 rate it a hold.

The average volume for Campbell Soup has been 1.3 million shares per day over the past 30 days. Campbell has a market cap of $14.9 billion and is part of the consumer goods sector and food & beverage industry. The stock has a beta of 0.84 and a short float of 6% with 9.62 days to cover. Shares are up 8.8% year-to-date as of the close of trading on Monday.

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 Campbell Soup as a buy. The company's strengths can be seen in multiple areas, such as its notable return on equity, expanding profit margins and increase in stock price during the past year. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the ratings report include:
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Food Products industry and the overall market, CAMPBELL SOUP CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • 39.79% is the gross profit margin for CAMPBELL SOUP CO which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 9.57% is above that of the industry average.
  • CAMPBELL SOUP CO reported flat earnings per share in the most recent quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CAMPBELL SOUP CO increased its bottom line by earning $2.32 versus $2.16 in the prior year. This year, the market expects an improvement in earnings ($2.38 versus $2.32).
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 11.2%. Since the same quarter one year prior, revenues slightly dropped by 3.5%. Weakness in the company's revenue seems to not be hurting the bottom line, shown by stable earnings per share.

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

Global Stocks Rally as US-China Trade War Thaws; Dow Could Test 25,000

Global Stocks Rally as US-China Trade War Thaws; Dow Could Test 25,000

GE Confirms $11.1 Billion Transportation Merger With Wabtec

GE Confirms $11.1 Billion Transportation Merger With Wabtec

China Trade Truce, General Electric and Tesla - 5 Things You Must Know

China Trade Truce, General Electric and Tesla - 5 Things You Must Know

GE Shares Gain Amid Reports of $20 Billion Wabtec Deal

GE Shares Gain Amid Reports of $20 Billion Wabtec Deal

Listen: Here's What You Need To Know About ETFs Today (Hint: They're on Fire!)

Listen: Here's What You Need To Know About ETFs Today (Hint: They're on Fire!)