Trade-Ideas LLC identified Tyco International ( TYC) 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 Tyco International as such a stock due to the following factors:

  • TYC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $95.6 million.
  • TYC has traded 805,059 shares today.
  • TYC traded in a range 224.7% of the normal price range with a price range of $1.55.
  • TYC traded above its daily resistance level (quality: 260 days, meaning that the stock is crossing a resistance level set by the last 260 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 TYC:

Tyco International plc provides security products and services, fire detection and suppression products and services, and life safety products worldwide. The stock currently has a dividend yield of 2.3%. TYC has a PE ratio of 29. Currently there are 5 analysts that rate Tyco International a buy, 1 analyst rates it a sell, and 4 rate it a hold.

The average volume for Tyco International has been 4.0 million shares per day over the past 30 days. Tyco International has a market cap of $15.0 billion and is part of the services sector and diversified services industry. The stock has a beta of 0.90 and a short float of 0.9% with 1.34 days to cover. Shares are up 10.5% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Tyco International as a buy. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Net operating cash flow has significantly increased by 98.95% to $191.00 million when compared to the same quarter last year. In addition, TYCO INTERNATIONAL PLC has also vastly surpassed the industry average cash flow growth rate of 1.40%.
  • 40.45% is the gross profit margin for TYCO INTERNATIONAL PLC 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 3.19% trails the industry average.
  • The current debt-to-equity ratio, 0.57, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that TYC's debt-to-equity ratio is low, the quick ratio, which is currently 0.63, displays a potential problem in covering short-term cash needs.
  • TYCO INTERNATIONAL PLC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, TYCO INTERNATIONAL PLC reported lower earnings of $1.44 versus $1.69 in the prior year. This year, the market expects an improvement in earnings ($2.10 versus $1.44).
  • TYC, with its decline in revenue, slightly underperformed the industry average of 2.2%. Since the same quarter one year prior, revenues slightly dropped by 4.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

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