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

  • SWIR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $16.2 million.
  • SWIR has traded 55,348 shares today.
  • SWIR is up 3.2% today.
  • SWIR was down 5.6% yesterday.

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More details on SWIR:

Sierra Wireless, Inc., together with its subsidiaries, provides cellular wireless solutions to the machine-to-machine (M2M) and connected device markets in North America, Europe, and the Asia Pacific. Currently there is 1 analyst that rates Sierra Wireless a buy, no analysts rate it a sell, and 7 rate it a hold.

The average volume for Sierra Wireless has been 435,100 shares per day over the past 30 days. Sierra Wireless has a market cap of $485.6 million and is part of the technology sector and telecommunications industry. The stock has a beta of 2.92 and a short float of 3.3% with 2.44 days to cover. Shares are down 70% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Sierra Wireless as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including poor profit margins, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 9.1%. Since the same quarter one year prior, revenues slightly increased by 7.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Communications Equipment industry. The net income increased by 213.2% when compared to the same quarter one year prior, rising from -$2.90 million to $3.29 million.
  • SIERRA WIRELESS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, SIERRA WIRELESS INC reported poor results of -$0.53 versus -$0.51 in the prior year. This year, the market expects an improvement in earnings ($0.82 versus -$0.53).
  • The gross profit margin for SIERRA WIRELESS INC is currently lower than what is desirable, coming in at 31.70%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 2.12% significantly trails the industry average.
  • Net operating cash flow has significantly decreased to $10.44 million or 63.55% 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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