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 Interpublic Group of Companies ( IPG) 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 Interpublic Group of Companies as such a stock due to the following factors:

  • IPG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $68.6 million.
  • IPG has traded 266,679 shares today.
  • IPG traded in a range 249.4% of the normal price range with a price range of $0.83.
  • IPG traded above its daily resistance level (quality: 48 days, meaning that the stock is crossing a resistance level set by the last 48 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.

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More details on IPG:

The Interpublic Group of Companies, Inc. provides advertising and marketing services. The company operates in two segments, Integrated Agency Networks and Constituency Management Group. The stock currently has a dividend yield of 2.4%. IPG has a PE ratio of 17. Currently there are 7 analysts that rate Interpublic Group of Companies a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Interpublic Group of Companies has been 3.4 million shares per day over the past 30 days. Interpublic Group of Companies has a market cap of $8.3 billion and is part of the services sector and media industry. The stock has a beta of 1.68 and a short float of 2.8% with 3.52 days to cover. Shares are down 4.7% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Interpublic Group of Companies as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, notable return on equity, attractive valuation levels and increase in stock price during the past year. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • INTERPUBLIC GROUP OF COS 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 two years. We feel that this trend should continue. During the past fiscal year, INTERPUBLIC GROUP OF COS increased its bottom line by earning $1.12 versus $0.59 in the prior year. This year, the market expects an improvement in earnings ($1.15 versus $1.12).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Media industry. The net income increased by 91.4% when compared to the same quarter one year prior, rising from -$20.90 million to -$1.80 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 3.8%. Since the same quarter one year prior, revenues slightly increased by 2.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Media industry and the overall market, INTERPUBLIC GROUP OF COS's return on equity significantly exceeds that of both the industry average and the S&P 500.

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