Trade-Ideas LLC identified Conn's ( CONN) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Conn's as such a stock due to the following factors:

  • CONN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $33.8 million.
  • CONN has traded 584,045 shares today.
  • CONN is up 3.9% today.
  • CONN was down 7.3% yesterday.

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More details on CONN:

Conn's, Inc. operates as a specialty retailer of durable consumer goods and related services in the United States. It operates through Retail and Credit segments. CONN has a PE ratio of 24. Currently there are 4 analysts that rate Conn's a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Conn's has been 661,100 shares per day over the past 30 days. Conn's has a market cap of $1.0 billion and is part of the services sector and retail industry. The stock has a beta of 2.66 and a short float of 47.8% with 9.09 days to cover. Shares are up 41.2% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Conn's as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:
  • CONN's revenue growth has slightly outpaced the industry average of 10.5%. Since the same quarter one year prior, revenues rose by 12.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • The gross profit margin for CONN'S INC is rather high; currently it is at 52.36%. Regardless of CONN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 4.17% trails the industry average.
  • CONN'S INC's earnings per share declined by 6.3% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, CONN'S INC reported lower earnings of $1.59 versus $2.54 in the prior year. This year, the market expects an improvement in earnings ($2.20 versus $1.59).
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed compared to the Specialty Retail industry average, but is greater than that of the S&P 500. The net income has decreased by 6.3% when compared to the same quarter one year ago, dropping from $17.65 million to $16.54 million.
  • CONN is off 6.90% from its price level of one year ago, reflecting a combination of (a) the general market trend and (b) the company's own weaknesses, including its lower earnings per share compared to the year-earlier quarter. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.

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