Trade-Ideas: Fairchild Semiconductor International (FCS) Is Today's

Trade-Ideas LLC identified Fairchild Semiconductor International ( FCS) 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 Fairchild Semiconductor International as such a stock due to the following factors:

  • FCS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $25.9 million.
  • FCS has traded 1.3 million shares today.
  • FCS traded in a range 365.9% of the normal price range with a price range of $0.23.
  • FCS traded above its daily resistance level (quality: 3 days, meaning that the stock is crossing a resistance level set by the last 3 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 FCS:

Fairchild Semiconductor International, Inc., through its subsidiary, Fairchild Semiconductor Corporation, designs, develops, manufactures, and markets power analog, power discrete, and non-power semiconductor solutions worldwide. FCS has a PE ratio of 37. Currently there are no analysts that rate Fairchild Semiconductor International a buy, no analysts rate it a sell, and 8 rate it a hold.

The average volume for Fairchild Semiconductor International has been 1.4 million shares per day over the past 30 days. Fairchild Semiconductor International has a market cap of $2.3 billion and is part of the technology sector and electronics industry. The stock has a beta of 1.22 and a short float of 2.8% with 2.82 days to cover. Shares are down 3.5% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Fairchild Semiconductor International as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.

Highlights from the ratings report include:
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • FAIRCHILD SEMICONDUCTOR INTL reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, FAIRCHILD SEMICONDUCTOR INTL continued to lose money by earning -$0.13 versus -$0.30 in the prior year. This year, the market expects an improvement in earnings ($0.82 versus -$0.13).
  • 41.61% is the gross profit margin for FAIRCHILD SEMICONDUCTOR INTL which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -2.23% is in-line with the industry average.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 9.2%. Since the same quarter one year prior, revenues slightly dropped by 5.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, FAIRCHILD SEMICONDUCTOR INTL's return on equity significantly trails that of both the industry average and the S&P 500.

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