Trade-Ideas LLC identified Ryder System ( R) as a "roof leaker" (crossing below the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified Ryder System as such a stock due to the following factors:

  • R has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $57.0 million.
  • R has traded 1.2 million shares today.
  • R is trading at 1.98 times the normal volume for the stock at this time of day.
  • R crossed below its 200-day simple moving average.

'Roof Leaker' stocks are worth watching because trading stocks that begin to experience a breakdown can lead to potentially massive losses. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock may then be subject to emotional selling from investors that can continue to drive the stock lower. Regardless of the impetus behind the price and volume action, when a stock moves with weakness and volume it can indicate the start of a new, potentially dangerous, trend.

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More details on R:

Ryder System, Inc. provides transportation and supply chain management solutions to small businesses and large enterprises worldwide. The company operates in three segments: Fleet Management Solutions; Dedicated Transportation Solutions; and Supply Chain Solutions. The stock currently has a dividend yield of 2.7%. R has a PE ratio of 12. Currently there are 6 analysts that rate Ryder System a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Ryder System has been 759,200 shares per day over the past 30 days. Ryder System has a market cap of $3.5 billion and is part of the services sector and diversified services industry. The stock has a beta of 1.52 and a short float of 4.9% with 2.96 days to cover. Shares are up 16% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Ryder System as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, attractive valuation levels, good cash flow from operations, expanding profit margins and notable return on equity. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 10.6%. Since the same quarter one year prior, revenues slightly increased by 2.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has slightly increased to $397.66 million or 4.57% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -16.33%.
  • 38.32% is the gross profit margin for RYDER SYSTEM INC which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, R's net profit margin of 4.32% significantly trails the industry average.
  • 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 Road & Rail industry and the overall market on the basis of return on equity, RYDER SYSTEM INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

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