Trade-Ideas LLC identified Delphi Automotive ( DLPH) 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 Delphi Automotive as such a stock due to the following factors:

  • DLPH has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $170.5 million.
  • DLPH has traded 763,788 shares today.
  • DLPH traded in a range 213.8% of the normal price range with a price range of $3.38.
  • DLPH traded below its daily resistance level (quality: 9 days, meaning that the stock is crossing a resistance level set by the last 9 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 DLPH:

Delphi Automotive PLC, together with its subsidiaries, manufacturers vehicle components; and provides electrical and electronic, powertrain, safety, and thermal technology solutions to the automotive and commercial vehicle markets worldwide. The stock currently has a dividend yield of 1.2%. DLPH has a PE ratio of 19. Currently there are 8 analysts that rate Delphi Automotive a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Delphi Automotive has been 2.2 million shares per day over the past 30 days. Delphi Automotive has a market cap of $24.0 billion and is part of the consumer goods sector and automotive industry. The stock has a beta of 0.95 and a short float of 1.8% with 2.52 days to cover. Shares are up 18.5% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Delphi Automotive as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income, notable return on equity and growth in earnings per share. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 31.24% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, DLPH should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Auto Components industry average. The net income increased by 68.8% when compared to the same quarter one year prior, rising from $382.00 million to $645.00 million.
  • 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 Auto Components industry and the overall market, DELPHI AUTOMOTIVE PLC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • DELPHI AUTOMOTIVE PLC's earnings per share improvement from the most recent quarter was slightly positive. 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, DELPHI AUTOMOTIVE PLC increased its bottom line by earning $4.38 versus $3.89 in the prior year. This year, the market expects an improvement in earnings ($5.30 versus $4.38).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 5.4%. Since the same quarter one year prior, revenues slightly dropped by 5.0%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

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