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 Hecla Mining ( HL) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Hecla Mining as such a stock due to the following factors:

  • HL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $14.3 million.
  • HL has traded 292,946 shares today.
  • HL is down 3% today.
  • HL was up 10.4% yesterday.

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More details on HL:

Hecla Mining Company, together with its subsidiaries, discovers, acquires, develops, produces, and markets precious and base metal deposits worldwide. The stock currently has a dividend yield of 0.4%. HL has a PE ratio of 48. Currently there is 1 analyst that rates Hecla Mining a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for Hecla Mining has been 4.4 million shares per day over the past 30 days. Hecla has a market cap of $892.5 million and is part of the basic materials sector and metals & mining industry. The stock has a beta of 0.74 and a short float of 7% with 3.51 days to cover. Shares are down 4.7% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Hecla Mining as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. 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 Metals & Mining industry. The net income increased by 7.8% when compared to the same quarter one year prior, going from $11.64 million to $12.55 million.
  • The current debt-to-equity ratio, 0.37, is low and is below the industry average, implying that there has been successful management of debt levels. Along with this, the company maintains a quick ratio of 2.70, which clearly demonstrates the ability to cover short-term cash needs.
  • Despite the weak revenue results, HL has outperformed against the industry average of 17.4%. Since the same quarter one year prior, revenues slightly dropped by 5.3%. Weakness in the company's revenue seems to not be hurting the bottom line, shown by stable earnings per share.
  • HL's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 30.15%, which is also worse than the performance of the S&P 500 Index. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • Net operating cash flow has decreased to $21.42 million or 29.50% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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