Trade-Ideas LLC identified FMC ( FMC) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified FMC as such a stock due to the following factors:

  • FMC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $42.5 million.
  • FMC has traded 1.1 million shares today.
  • FMC traded in a range 211.7% of the normal price range with a price range of $3.04.
  • FMC traded above its daily resistance level (quality: 87 days, meaning that the stock is crossing a resistance level set by the last 87 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' 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 positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on FMC:

FMC Corporation, a diversified chemical company, provides solutions, applications, and products for the agricultural, consumer, and industrial markets in North America, Europe, the Middle East, Africa, Latin America, and the Asia Pacific. The stock currently has a dividend yield of 1.7%. Currently there are 6 analysts that rate FMC a buy, 2 analysts rate it a sell, and 4 rate it a hold.

The average volume for FMC has been 1.3 million shares per day over the past 30 days. FMC has a market cap of $5.1 billion and is part of the basic materials sector and chemicals industry. The stock has a beta of 1.74 and a short float of 9.1% with 10.06 days to cover. Shares are down 1.3% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates FMC as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, disappointing return on equity, poor profit margins, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Chemicals industry. The net income has significantly decreased by 366.8% when compared to the same quarter one year ago, falling from $76.50 million to -$204.10 million.
  • 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 Chemicals industry and the overall market, FMC CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for FMC CORP is currently lower than what is desirable, coming in at 34.27%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -22.69% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$47.20 million or 127.44% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 41.84%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 319.35% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

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