Barbarian At The Gate: Cablevision Systems (CVC)

Trade-Ideas LLC identified Cablevision Systems ( CVC) 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 Cablevision Systems as such a stock due to the following factors:

  • CVC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $86.3 million.
  • CVC has traded 933,236 shares today.
  • CVC traded in a range 224.8% of the normal price range with a price range of $0.46.
  • CVC traded above its daily resistance level (quality: 532 days, meaning that the stock is crossing a resistance level set by the last 532 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 CVC:

Cablevision Systems Corporation, together with its subsidiaries, owns and operates cable systems in the United States. The company operates through three segments: Cable, Lightpath, and Other. The stock currently has a dividend yield of 1.8%. CVC has a PE ratio of 47. Currently there are 2 analysts that rate Cablevision Systems a buy, 1 analyst rates it a sell, and 7 rate it a hold.

The average volume for Cablevision Systems has been 2.5 million shares per day over the past 30 days. Cablevision Systems has a market cap of $9.0 billion and is part of the services sector and media industry. The stock has a beta of 0.45 and a short float of 4.7% with 3.20 days to cover. Shares are up 3.3% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Cablevision Systems as a hold. The company's strengths can be seen in multiple areas, such as its expanding profit margins and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and feeble growth in the company's earnings per share.

Highlights from the ratings report include:
  • CVC, with its decline in revenue, slightly underperformed the industry average of 7.9%. Since the same quarter one year prior, revenues slightly dropped by 0.1%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The gross profit margin for CABLEVISION SYS CORP is rather high; currently it is at 51.15%. Regardless of CVC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, CVC's net profit margin of 1.97% is significantly lower than the industry average.
  • Compared to its closing price of one year ago, CVC's share price has jumped by 80.32%, exceeding the performance of the broader market during that same time frame. Looking ahead, however, we cannot assume that the stock's past performance is going to drive future results. Quite to the contrary, its sharp appreciation over the last year is one of the factors that should prompt investors to seek better opportunities elsewhere.
  • 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 Media industry. The net income has significantly decreased by 42.6% when compared to the same quarter one year ago, falling from $55.98 million to $32.12 million.
  • Net operating cash flow has declined marginally to $337.78 million or 3.24% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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