Trade-Ideas LLC identified Avon Products ( AVP) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Avon Products as such a stock due to the following factors:

  • AVP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $14.5 million.
  • AVP has traded 1.0 million shares today.
  • AVP is down 3.1% today.
  • AVP was up 5.1% yesterday.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in AVP with the Ticky from Trade-Ideas. See the FREE profile for AVP NOW at Trade-Ideas

More details on AVP:

Avon Products, Inc. manufactures and markets beauty and related products worldwide. The stock currently has a dividend yield of 5.9%. Currently there are 2 analysts that rate Avon Products a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for Avon Products has been 6.4 million shares per day over the past 30 days. Avon has a market cap of $1.6 billion and is part of the consumer goods sector and consumer non-durables industry. The stock has a beta of 2.33 and a short float of 7% with 7.00 days to cover. Shares are down 3.2% year-to-date as of the close of trading on Wednesday.

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 Avon Products as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the ratings report include:
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed compared to the Personal Products industry average, but is greater than that of the S&P 500. The net income has decreased by 12.8% when compared to the same quarter one year ago, dropping from -$147.00 million to -$165.80 million.
  • Net operating cash flow has decreased to -$236.20 million or 19.23% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, AVON PRODUCTS has marginally lower results.
  • Looking at the price performance of AVP's shares over the past 12 months, there is not much good news to report: the stock is down 45.93%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • AVON PRODUCTS's earnings per share declined by 9.1% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, AVON PRODUCTS reported poor results of -$1.80 versus -$0.88 in the prior year. This year, the market expects an improvement in earnings ($0.13 versus -$1.80).
  • AVP, with its decline in revenue, underperformed when compared the industry average of 3.9%. Since the same quarter one year prior, revenues fell by 15.8%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

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.