Rick Pendergraft's Avatar
Rick Pendergraft
published in Blogs
Oct 14, 2019
These 3 railroad companies show great risk vs. reward readings ahead of earnings.

These 3 railroad companies show great risk vs. reward readings ahead of earnings.

One of the oldest investing theories was developed from the ideologies of Charles Dow and his notes on investing. While Dow himself never called his ideas the “Dow Theory”, different authors have extrapolated on his ideologies to develop what we now know by that name. One of the tenets of the Dow Theory is that transportation stocks are a leading indicator on economic conditions. If transport companies, and specifically railroad companies, were doing well, then industrial companies would follow suit.  Essentially the idea is, as long as transportation companies are busy delivering parts and end products, the manufacturers are busy producing their goods.

Of course, our economy has changed greatly since Charles Dow passed away in 1902, but there is still some merit in this line of thinking. Personally I have had three particular railroad companies on my radar for some time now and all three of them are set to report earnings in the next two weeks.

CSX Inc. (Nasdaq: CSX) is set to report earnings on October 16, Norfolk Southern (NYSE: NSC) is set to report on October 23, and Old Dominion Freight Line (Nasdaq: ODFL) is set to report on October 24.

If we look at the Tickeron Fundamental Ratings for these three stocks, we see that all three have better than average Profit vs. Risk ratings, average SMR ratings, and better than average P/E growth ratings. CSX and Old Dominion are slightly overvalued at this time and CSX and Norfolk Southern are both slightly below average in terms of their Price Growth Ratings.

Looking at some of the different indicators from Investor’s Business Daily, all three of the stocks rank in the top 20th percentile in terms of their earnings growth based on the EPS ratings and all three get an “A” in the SMR category. The relative price strength rating shows that Old Dominion has outperformed the other two in terms of stock price performance, and as a result it has a higher overall composite rating.

If you look at the weekly charts of the three stocks, Old Dominion is overbought based on its weekly stochastic readings while CSX and Norfolk Southern have both just moved out of oversold territory in the last few weeks. Both CSX and Norfolk Southern seem to be using their 100-week moving averages as support at this time.

Looking at the sentiment indicators for the three stocks, we see that none of the three are exactly overly loved by analysts. Only Norfolk Southern has more buy ratings than hold and sell ratings, but only by one.

Old Dominion is particularly interesting in that it has 16 analysts following it, but only five of the 16 have the stock rated as a “buy”. I also find it interesting that the short interest ratio is pretty lofty at 7.2. This suggests that there is significantly more bearish sentiment toward the company than the average stock and the other two railroad stocks.

Personally I like all three of these stocks at this time. All three have pretty solid fundamentals and all three have a certain degree of pessimism being directed at them. Old Dominion has outperformed on a technical basis, but it is overbought. If you don’t mind buying in to strength and near a top, Old Dominion probably makes the most sense. If you like buying on a dip, CSX or Norfolk Southern might make more sense for you.

Related Tickers: CSX
Sergey Savastiouk's Avatar
Sergey Savastiouk
published in Blogs
Mar 07, 2021
4 Tricks Hedge Funds Use to Get Ahead

4 Tricks Hedge Funds Use to Get Ahead

If the stock market were Major League Baseball, hedge funds and institutional investors would be the pros on championship teams while everyday self-directed investors (SDIs) are the benchwarmers in the minors.It’s how they get ahead, and it’s why 90% of SDIs lose money trying to play (invest and trade) in the major leagues. The 4 tricks we discuss below are rooted in one common theme: they all use Artificial Intelligence and algorithms to generate data and ideas.
John Jacques's Avatar
John Jacques
published in Blogs
Mar 22, 2018
A.I. Stock Market Predictions: Head & Shoulders

A.I. Stock Market Predictions: Head & Shoulders

Statistics for the Head-and-Shoulders Bottom Pattern The days where only hedge funds used algorithms to trade stocks are officially over. Now retail investors can use Artificial Intelligence (A.I.  Here’s an example of the algorithm in action: Late last year, Tickeron’s A.I.
Sergey Savastiouk's Avatar
Sergey Savastiouk
published in Blogs
Jul 10, 2020
3 Stocks to Buy if Coronavirus Second Wave Hits

3 Stocks to Buy if Coronavirus Second Wave Hits

By analyzing market trends from the first wave, you can predict behavior for the second. Technology stocks have performed at historic levels this year, but the market is severely overbought.To compensate for that, look at performance during Q1 and Q2, the height of global Covid shutdowns.
Edward Flores's Avatar
Edward Flores
published in Blogs
Feb 06, 2021
How to Become the Millionaire Next Door

How to Become the Millionaire Next Door

The Golden Gate Bridge is always a fixture of these walks too, one of man's most beautiful creations.  As we were walking, at one point she turned to me and said, "Man, I'll never have a million dollars."" My girlfriend is 27 years old and works as a graphic designer, making about $75,000 a year.
Alla Petriaieva's Avatar
Alla Petriaieva
published in Blogs
Feb 23, 2021
Is Ethereum’s Bomb about to Explode?

Is Ethereum’s Bomb about to Explode?

Ethereum’s software is set for an update in October.Until it is finished, participants in the Ethereum blockchain must determine how to delay the difficulty bomb – code that necessitates a steadily increasing amount of computer power to mine blocks and unlock rewards – that is already in place.
Sergey Savastiouk's Avatar
Sergey Savastiouk
published in Blogs
Aug 07, 2018
When Is the Next Recession Coming?

When Is the Next Recession Coming?

However, we also know that economists predicted 22 recessions out of 11 that took place since 1945. Are there real recession signs we should watch for?Indeed, the answer is yes, and here are a few very important ones: The first one is almost obvious and known to everyone – it is the Fed.
Abhoy Sarkar's Avatar
Abhoy Sarkar
published in Blogs
May 22, 2020
Central banks have been buying $2.4 billion in assets every hour for the past two months

Central banks have been buying $2.4 billion in assets every hour for the past two months

Some $17.8 billion has been poured into  bond markets over the past week, the biggest move in more than three months.Around $3.5 billion has been invested into gold, the second largest on record. 
Rick Pendergraft's Avatar
Rick Pendergraft
published in Blogs
Feb 07, 2021
Mid-January Short Interest Report Shows 8 Stocks with Good Fundamentals and High Short Interest
Sergey Savastiouk's Avatar
Sergey Savastiouk
published in Blogs
Mar 10, 2021
How to Start Trading Penny Stocks

How to Start Trading Penny Stocks

Penny stocks have long been marginalized within the professional investment community, oftentimes being painted with a broad brush of simply being “too risky.” Leonardo DiCaprio’s depiction of the penny stock peddling conman, Jordan Belfort, in the Wolf of Wall Street certainly didn’t help.Here are four reasons to start trading them now. Reason #1: Let’s State the Obvious -- Penny Stocks are Cheap A single share of Apple Inc. costs over $350.
Abhoy Sarkar's Avatar
Abhoy Sarkar
published in Blogs
May 08, 2020
US unemployment rate jumps to 14.7%, the highest in series history

US unemployment rate jumps to 14.7%, the highest in series history

The U.S. economy’s employment fell by -20.5 million in April. The coronavirus crisis led to unemployment rate soaring to 14.7% in the U.S, the highest rate in the Bureau of Labor Statistics-tracked series history that goes back to 1948. However, the figures were better compared to several economists'/analysts' forecasts of 22 million job losses and 16% unemployment rate.  Another unemployment measure that includes those who have stopped looking for work as well as those holding part-time jobs for economic reasons also touched an all-time high of 22.8%.