Trade-Ideas LLC identified Sturm Ruger ( RGR) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Sturm Ruger as such a stock due to the following factors:

  • RGR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $17.0 million.
  • RGR has traded 51,108 shares today.
  • RGR is down 3% today.
  • RGR was up 6.8% yesterday.

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More details on RGR:

Sturm, Ruger & Company, Inc. designs, manufactures, and sells firearms under the Ruger trademark in the United States. The stock currently has a dividend yield of 1.8%. RGR has a PE ratio of 39. Currently there are 2 analysts that rate Sturm Ruger a buy, 1 analyst rates it a sell, and none rate it a hold.

The average volume for Sturm Ruger has been 200,500 shares per day over the past 30 days. Sturm Ruger has a market cap of $1.1 billion and is part of the industrial goods sector and aerospace/defense industry. The stock has a beta of 0.33 and a short float of 9.8% with 4.98 days to cover. Shares are up 9.9% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Sturm Ruger as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and increase in net income. However, as a counter to these strengths, we also find weaknesses including premium valuation and disappointing return on equity.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 3.7%. Since the same quarter one year prior, revenues rose by 22.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • RGR has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, RGR has a quick ratio of 1.61, which demonstrates the ability of the company to cover short-term liquidity needs.
  • STURM RUGER & CO 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, STURM RUGER & CO INC reported lower earnings of $1.91 versus $5.60 in the prior year. This year, the market expects an improvement in earnings ($2.92 versus $1.91).
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Leisure Equipment & Products industry and the overall market on the basis of return on equity, STURM RUGER & CO INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

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