Below is a market neutral trade I opened Tuesday morning, but first I wanted to thank those of you who have downloaded and rated the Portfolio Armor iOS app. When I checked AppShopper.com at the end of last week, I saw the screen cap below, which showed that, among the top 200 paid finance iOS apps, Portfolio Armor had the highest customer rating. Thanks again for that.
On Tuesday morning, I shorted USG Corp. (USG, Financial) at $15.09 and bought an equivalent dollar amount of Interface Inc. (IFSIA, Financial) at $18.55. I e-mailed the trade idea to those on the market neutral trade notification list before market hours Tuesday.
USG Corporation USG Corp. manufactures sheet rock and other types of wallboard. I shorted this one last year, and got stopped out for a single-digit loss. I plan on using a double-digit trailing stop this time, on both the long and short side of this trade. I’ll probably use slightly tighter stops initially this time than I did initially on the last market neutral trade (long IMO, short TRGL) though. Charts below courtesy of Finviz.com.
Short Screen shows an Altman Z-Score of 0.59 for USG. Scores below 1.81 are considered an indication of financial distress, according to the model.
USG is currently rated as having Average Accounting & Governance Risk (AGR®), receiving an AGR Score of 70 percentile among the approximately 8,000 companies in North America rated by Audit Integrity, indicating higher accounting and governance risk than 30% of the other companies.
USG had negative earnings over the trailing twelve months and has an PEG ratio of -0.19 (based on analysts’ estimates of its earnings over the next five years).
Interface Inc. (IFSIA) manufactures modular and broadloom carpets, and other floor covering products.
IFSIA has an Altman Z-Score of 3.37. Scores above 3 are considered indications of financial strength.
IFSIA is currently rated as having Conservative Accounting & Governance Risk (AGR®), receiving an AGR Score of 98 percentile among the approximately 8,000 companies in North America rated by Audit Integrity, indicating higher accounting and governance risk than 2% of the other companies.
IFSIA looks pricey based on trailing earnings, but it has a PEG ratio of 1.44 (based on analysts’ estimates of its earnings over the next five years), which looks a little more reasonable.
On Tuesday morning, I shorted USG Corp. (USG, Financial) at $15.09 and bought an equivalent dollar amount of Interface Inc. (IFSIA, Financial) at $18.55. I e-mailed the trade idea to those on the market neutral trade notification list before market hours Tuesday.
USG Corporation USG Corp. manufactures sheet rock and other types of wallboard. I shorted this one last year, and got stopped out for a single-digit loss. I plan on using a double-digit trailing stop this time, on both the long and short side of this trade. I’ll probably use slightly tighter stops initially this time than I did initially on the last market neutral trade (long IMO, short TRGL) though. Charts below courtesy of Finviz.com.
Short Screen shows an Altman Z-Score of 0.59 for USG. Scores below 1.81 are considered an indication of financial distress, according to the model.
USG is currently rated as having Average Accounting & Governance Risk (AGR®), receiving an AGR Score of 70 percentile among the approximately 8,000 companies in North America rated by Audit Integrity, indicating higher accounting and governance risk than 30% of the other companies.
USG had negative earnings over the trailing twelve months and has an PEG ratio of -0.19 (based on analysts’ estimates of its earnings over the next five years).
Interface Inc. (IFSIA) manufactures modular and broadloom carpets, and other floor covering products.
IFSIA has an Altman Z-Score of 3.37. Scores above 3 are considered indications of financial strength.
IFSIA is currently rated as having Conservative Accounting & Governance Risk (AGR®), receiving an AGR Score of 98 percentile among the approximately 8,000 companies in North America rated by Audit Integrity, indicating higher accounting and governance risk than 2% of the other companies.
IFSIA looks pricey based on trailing earnings, but it has a PEG ratio of 1.44 (based on analysts’ estimates of its earnings over the next five years), which looks a little more reasonable.
