Trade-Ideas LLC identified SanDisk ( SNDK) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified SanDisk as such a stock due to the following factors:
- SNDK has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $236.6 million.
- SNDK has traded 718,777 shares today.
- SNDK traded in a range 200.8% of the normal price range with a price range of $1.38.
- SNDK traded below its daily resistance level (quality: 7 days, meaning that the stock is crossing a resistance level set by the last 7 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).
Stocks matching the 'Water-Logged and Getting Wetter' 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 negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower. EXCLUSIVE OFFER: Get the inside scoop on opportunities in SNDK with the Ticky from Trade-Ideas. See the FREE profile for SNDK NOW at Trade-Ideas More details on SNDK: SanDisk Corporation designs, develops, manufactures, and markets data storage solutions in the United States and internationally. The stock currently has a dividend yield of 1.7%. SNDK has a PE ratio of 42. Currently there are 2 analysts that rate SanDisk a buy, 1 analyst rates it a sell, and 15 rate it a hold. The average volume for SanDisk has been 3.6 million shares per day over the past 30 days. SanDisk has a market cap of $15.4 billion and is part of the technology sector and computer hardware industry. The stock has a beta of 2.20 and a short float of 8.2% with 4.64 days to cover. Shares are up 0.7% year-to-date as of the close of trading on Thursday. EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE. TheStreetRatings.com Analysis: TheStreet Quant Ratings rates SanDisk as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and increase 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:
- The revenue growth came in higher than the industry average of 12.9%. Since the same quarter one year prior, revenues slightly increased by 2.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The current debt-to-equity ratio, 0.39, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.36, which illustrates the ability to avoid short-term cash problems.
- 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. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry, implying reduced upside potential.
- 46.86% is the gross profit margin for SANDISK CORP which we consider to be strong. Regardless of SNDK's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SNDK's net profit margin of 5.73% is significantly lower than the industry average.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. In comparison to the other companies in the Computers & Peripherals industry and the overall market, SANDISK CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- You can view the full SanDisk Ratings Report.
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