Shorts Gang Up Against YRC Worldwide Inc. (YRCW) Stock

For the period that ended August 30, 2019, the short interest in YRC Worldwide Inc. (NASDAQ:YRCW) stock is on the up. The 20.59% rise could be an indication that investors and traders expect a drop in the share price, often as a result of a drop in the business’ fundamentals. The average brokerage opinion at 2.7 suggests acquiring these shares. Between August 15 and August 30, the total count of shorted shares totalled 7.17 million. That number was 1,224,272 more shares compared with the total of 5.94 million shares in the space of prior two weeks, which suggests more traders or funds are betting that the company stock will move down. The average daily volume for YRCW at the August 30th settlement retreated to 1,021,197, versus 1,189,049 at the August 15th report. That led days to cover to move at 7.020017, a 40.42% increase compared to the 4.999414 days to cover recorded at the prior short interest data release.

On September 19, 2019, YRC Worldwide Inc. (NASDAQ:YRCW) shares lost -5.62% or -0.24 points to close at $4.03 with a heavy trading volume of 1.245 million shares. It opened the trading session at $4.12, the shares rose to $4.21 and dropped to $3.975, the range by which the price of stock traded the whole day. The company now has a market cap of $143 million and currently has 35.41 million outstanding shares. YRC Worldwide Inc. (YRCW) stock has accumulated 59.29 percent of market value in 21 trading days.

YRCW stock’s trailing 3-year beta is 4.89, meaning there will be a greater rate of return, although posing a higher risk. The part of a firm’s profit given to each outstanding share of regular stock was -$1.59 share in the trailing 52 weeks. The stock’s value surged 27.94 percent year to date (YTD) compared to a decline of -58.79 percent in 52 week’s period. The firm’s shares are still trading -59.31 percent below its 1-year high of $9.90 and 106.67 percent up from 52-week low of $1.95. The average consensus ranking on the company is 2.7, on a ranging where 5 is equal to a consensus sell rating. In other words, the mean analyst recommendations are ranking this stock as a sell.

YRC Worldwide Inc. (YRCW) is most likely going to rise 61.29 percent in the coming 12 months, as per price target approximations compiled by finviz. Nevertheless, they have set the price target at a $20-month high price target. This represents a whopping 396.28 percent increase from the current trading of shares. The 52-week median price target given by the analysts is $5, which means a return possibility of 24.07 percent in comparison with the closing price of the stock of $4.03 on September 19. The lowest price set for the stock is $5 — just above 24.07 percent from YRCW share price now.

Past records have indicated that shares in YRC Worldwide Inc. declined on 23 different earnings reaction days and we have yet to see whether this trend will play out and remain in place when the company reports upcoming earnings. Investors will get the next hint of YRCW’s Q3 earnings on October 31. Analysts are predicting revenue to suffer decline of -1.5 percent to $1.28B in the financial third quarter, while EPS will soar by about -233.33 percent to -$0.12 per share. Earnings are seen to rise by 280.5 percent this year, 100.8 percent in the coming year and the trend continues by 0 percent every year in the next 5 years.

Let’s take a glimpse at some insider activity at YRC Worldwide Inc. (NASDAQ:YRCW) and observe the pattern. The earliest insider trade happened on 08/10/2018. Stone Loren Robert gathered a total of 2.5 thousand shares of the firm at average share price of $9.04. The total amount for the purchase was set at $22.6 thousand. On completing this exchange, the President, USF Reddaway Inc. account balance was 20.75 thousand shares. The stock lost -52.77 percent from that insider purchase. On 05/22/2018, Bromark Raymond J, Director, did a sale of 5 thousand shares at a price of $10.79 per share. This got rid of 53.95 thousand shares from the insider’s fortune and the stock experienced a -60.43 percent retreat in price since the news became public. This exchange saw 86.27 thousand shares get out from the Director account.

On 03/05/2018, President, USF Holland Ware Scott D. recorded a sale transaction valued at $120.54 thousand. The sale at $8.61 a share has eliminated 14 thousand shares from the insider’s portfolio position. Meanwhile, shares price witnessed -50.41 percent decrease since the transaction reporting date. The company insider is left with 39.1 thousand shares remaining in the account. Hall Justin M., who works as Chief Customer Officer at the company, performed a purchase of 5 thousand shares in a transaction worth $55.45 thousand. The acquisition recorded on 11/16/2017 was priced at $11.09 per share. The stock price plunged -61.5 percent since the transaction. Hall Justin M. currently holds a stake of 41.09 thousand in YRCW stock which is worth $165.6 thousand after the insider buying.

The stock is lingering around the initial support level of $3.93. After this, the following support is at the zone of $3.84. Up until the time the YRCW stock hit levels beyond the current one, bulls should have no alarm. In terms of its momentum, the stock’s RSI hit 62.25 on the daily chart, and this may be a cause for concern. In case the price goes below $3.84 level on closing basis, there may be more profit booking with the stock growing weaker. Still, getting to the $4.17 level may cause a pull-back move approaching $4.31 mark.

YRC Worldwide Inc. (YRCW) shares are trading at a P/E ratio of 0 times earnings posted in the trailing 12 months. The industry YRCW deals with has an average P/E of 23.1. Its P/B ratio is standing at 0X compared to the 2.3 industry average. It is additionally sporting a 0 on the Price-to-Sales ratio, compared to the industry’s P/S average of 0.9. YRC Worldwide Inc. has a 10.9% gross profit margin, with its operating margin around 1.6%. Alongside this, the company’s net profit margin currently stands at -1%.