Strong And Under The Radar: Deltic Timber (DEL)

Trade-Ideas LLC identified Deltic Timber ( DEL) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Deltic Timber as such a stock due to the following factors:

  • DEL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $3.4 million.
  • DEL has traded 0.432800000000000018030021919912542216479778289794921875 options contracts today.
  • DEL is making at least a new 3-day high.
  • DEL has a PE ratio of 256.
  • DEL is mentioned 0.65 times per day on StockTwits.
  • DEL has not yet been mentioned on StockTwits today.
  • DEL is currently in the upper 20% of its 1-year range.
  • DEL is in the upper 35% of its 20-day range.
  • DEL is in the upper 45% of its 5-day range.
  • DEL is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

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More details on DEL:

Deltic Timber Corporation, a natural resources company, engages in the growing and harvesting of timber; and manufacturing and marketing of lumber and medium density fiberboards (MDF) in the United States. The stock currently has a dividend yield of 0.6%. DEL has a PE ratio of 256.

The average volume for Deltic Timber has been 31,800 shares per day over the past 30 days. Deltic Timber has a market cap of $837.9 million and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 0.77 and a short float of 7.9% with 11.89 days to cover. Shares are up 17.1% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Deltic Timber as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and increase in net income. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, premium valuation and generally higher debt management risk.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 2.5%. Since the same quarter one year prior, revenues rose by 24.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Paper & Forest Products industry. The net income increased by 407.8% when compared to the same quarter one year prior, rising from $0.83 million to $4.22 million.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Paper & Forest Products industry and the overall market, DELTIC TIMBER CORP's return on equity is below that of both the industry average and the S&P 500.

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