| Prev Close: | 21.43 |
|---|---|
| Open: | 24.86 |
| Bid: | 24.50 x 100 |
| Ask: | 24.60 x 1000 |
| 1y Target Est: | 7.35 |
| Beta: | -0.16 |
| Next Earnings Date: | N/A |
| Day's Range: | 22.92 - 26.72 |
|---|---|
| 52wk Range: | 4.75 - 29.55 |
| Volume: | 7,803,705 |
| Avg Vol (3m): | 2,092,770 |
| Market Cap: | 131.98M |
| P/E (ttm): | N/A |
| EPS (ttm): | -0.65 |
| Div & Yield: | N/A (N/A) |
Now before we get into it, lets look at the candle chart and we find something interesting:
As you can see above, there is something that formed called a coiled spring. Coiled springs are technical terms where a stock has coiled up tightly into a specific price pattern with potential energy building up, much as a snake coiling up before it releases with a jump all the energy it built up in the coil..then it springs. In above, there was a panic building with the ebola, so everyone started to pile on this stock starting Oct 9th. The stock jumped on up over the course of the next week and is now overbought around 25 dollars. The fundementals dont support this high price. The technicals dont support this high price. Look at the RSI, the top indicator in complete oversold, beyond, oversold territory. Coiled springs spring either to the upside or the downside. I don't see any upside. Lets talk.
First of all, there is a specific problem with this. I know someone that works in the CDC. They tell me that while the suits seal, there is no set protocols in the hospitals for when they take the suit off. In a level 4 biolab, the person wearing the suit gets sprayed down after they leave the area they are working in, only then do they go into another room and remove the suit. Hospital workers that were working on the ebola patients do not observe this protocol. After they leave the infected patients room, they simply go into another room and remove the gear. Thats not gonna stop the transmission of this disease. Gov officials are becoming aware of this and taking steps. Second of all this stock in itself is nothing spectacular. Lets read:
NEW YORK (TheStreet) -- Shares of Lakeland Industries Inc. (LAKE) are climbing higher by 14.14% to $24.26 in pre-market trading on Wednesday morning, as the maker of protective gear gets a boost from the confirmation of a third case of Ebola in the U.S.
A Texas Health Presbyterian Hospital worker reported running a fever on Tuesday and was immediately placed in isolation, tests conducted later that day confirmed that the hospital employee, who helped care for the late Thomas Eric Duncan, has Ebola, CNN.com reports.
Concerns over the spreading of the Ebola Virus have had strong reactions on stocks, with some like Lakeland Industries and other safety garment makers rising, while airline stocks have slumped.
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As a result of the Ebola worries, Lakeland has seen a 208% stock surge and a rise in value to $115 million, Bloomberg reports.
"Lakeland is clearly is benefiting from the scare surrounding the Ebola virus. It's difficult to make an educated judgment on whether or not this will make a fundamental change as to the direction of the company," Bryant Saydah, the VP of institutional equity trading at Juda Group told Bloomberg.
Separately, TheStreet Ratings team rates LAKELAND INDUSTRIES INC as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
"We rate LAKELAND INDUSTRIES INC (LAKE) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures and notable return on equity. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, weak operating cash flow and poor profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Compared to its closing price of one year ago, LAKE's share price has jumped by 247.45%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- LAKELAND INDUSTRIES INC 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. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, LAKELAND INDUSTRIES INC turned its bottom line around by earning $0.00 versus -$4.88 in the prior year.
- Net operating cash flow has significantly decreased to -$1.90 million or 459.11% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Textiles, Apparel & Luxury Goods industry. The net income has significantly decreased by 109.3% when compared to the same quarter one year ago, falling from $4.17 million to -$0.39 million.
You can see that analysts are saying here that this stock (read between the lines) is a victim of hype and the numbers don't support this climb.
So:
1) The fundementals and numbers don't warrent the stock price
2) The crowd is freaking out and is involved in a sector scare jump on
3)Stock setting up for a coiled spring movement
There are no options available on this, we are just going to short it.
Stay Frosty,
Mark
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