Trade-Ideas LLC identified Weyerhaeuser ( WY) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Weyerhaeuser as such a stock due to the following factors:

  • WY has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $113.4 million.
  • WY has traded 3.2 million shares today.
  • WY traded in a range 218.1% of the normal price range with a price range of $1.22.
  • WY traded below its daily resistance level (quality: 494 days, meaning that the stock is crossing a resistance level set by the last 494 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Water-Logged and Getting Wetter' 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 negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.

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More details on WY:

Weyerhaeuser Co. is a real estate investment trust. It primarily invests in United States. The firm operates under four business segments, timberlands, wood products, cellulose fibers and real estate. It owns timberlands primarily in the U.S and has long-term licenses in Canada. The stock currently has a dividend yield of 3.9%. WY has a PE ratio of 27. Currently there are 5 analysts that rate Weyerhaeuser a buy, 2 analysts rate it a sell, and 4 rate it a hold.

The average volume for Weyerhaeuser has been 3.5 million shares per day over the past 30 days. Weyerhaeuser has a market cap of $15.4 billion and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 1.00 and a short float of 1.6% with 2.09 days to cover. Shares are down 21.5% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Weyerhaeuser as a buy. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and notable return on equity. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Net operating cash flow has increased to $366.00 million or 13.66% when compared to the same quarter last year. Despite an increase in cash flow, WEYERHAEUSER CO's average is still marginally south of the industry average growth rate of 15.86%.
  • WY, with its decline in revenue, underperformed when compared the industry average of 9.7%. Since the same quarter one year prior, revenues slightly dropped by 8.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • 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. When compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, WEYERHAEUSER CO's return on equity is below that of both the industry average and the S&P 500.
  • WEYERHAEUSER CO's earnings per share declined by 39.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, WEYERHAEUSER CO increased its bottom line by earning $1.38 versus $0.83 in the prior year. For the next year, the market is expecting a contraction of 23.6% in earnings ($1.06 versus $1.38).
  • The share price of WEYERHAEUSER CO has not done very well: it is down 10.33% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, although the push and pull of the overall market trend could certainly make a critical difference, we do not see any strong reason stemming from the company's fundamentals that would cause a continuation of last year's decline. In fact, the stock is now selling for less than others in its industry in relation to its current earnings.

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