Trade-Ideas LLC identified Time Warner Cable ( TWC) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Time Warner Cable as such a stock due to the following factors:

  • TWC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $359.7 million.
  • TWC has a PE ratio of 3.
  • TWC is currently in the upper 30% of its 1-year range.
  • TWC is in the upper 25% of its 20-day range.
  • TWC is in the upper 35% of its 5-day range.
  • TWC is currently trading above yesterday's high.
  • TWC has experienced a gap between today's open and yesterday's close of 0.8%.

'Momo Momentum' stocks are valuable stocks to watch for a variety of reasons including historical back testing and price action. Market technicians refer to such stocks as being in a mark-up phase before a possible distribution period and price decline. Technical analysts and traders frequently find that the factors referenced above tend to create a temporary burst of strong wind in a stock's sail. Nevertheless, all successful traders must excel at maximizing gains while keeping losses to an absolute minimum. For that reason, the holding period on momo momentum stocks must always be a primary consideration, and this part of the puzzle is ultimately at the discretion of each individual's risk tolerance and portfolio risk management skills.

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More details on TWC:

Time Warner Cable Inc., together with its subsidiaries, provides video, high-speed data, and voice services in the United States. It operates in three segments: Residential Services, Business Services, and Other Operations. The stock currently has a dividend yield of 1.5%. TWC has a PE ratio of 3. Currently there are 5 analysts that rate Time Warner Cable a buy, no analysts rate it a sell, and 11 rate it a hold.

The average volume for Time Warner Cable has been 1.8 million shares per day over the past 30 days. Time Warner Cable has a market cap of $55.5 billion and is part of the services sector and media industry. The stock has a beta of 0.99 and a short float of 2.9% with 4.79 days to cover. Shares are up 5.1% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Time Warner Cable as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, good cash flow from operations, expanding profit margins and notable return on equity. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the ratings report include:
  • Despite its growing revenue, the company underperformed as compared with the industry average of 7.8%. Since the same quarter one year prior, revenues slightly increased by 4.9%. 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.
  • Compared to its closing price of one year ago, TWC's share price has jumped by 25.70%, exceeding the performance of the broader market during that same time frame. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • Net operating cash flow has slightly increased to $1,833.00 million or 1.27% when compared to the same quarter last year. Despite an increase in cash flow, TIME WARNER CABLE INC's average is still marginally south of the industry average growth rate of 11.13%.
  • 35.11% is the gross profit margin for TIME WARNER CABLE INC which we consider to be strong. Regardless of TWC'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 8.00% trails the industry average.
  • TIME WARNER CABLE INC's earnings per share declined by 12.8% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, TIME WARNER CABLE INC reported lower earnings of $6.44 versus $7.17 in the prior year. This year, the market expects an improvement in earnings ($7.52 versus $6.44).

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