Value
9.2/10data confidence 67%| Component | Sub-score |
|---|---|
| P/E | 6.6 |
| P/S | 10.0 |
| EV/EBITDA | 7.3 |
| PEG | 10.0 |
- ▸PEG: 0.36
- ▸Attractively valued
WMK · Why this verdict
Why Weis Markets (WMK) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.7/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Weis Markets shows exceptional near-term technical momentum with a breakout above all moving averages and strong volume accumulation, but the business quality score of 3.3 is below the minimum floor and the stock offers no remaining upside to resistance, making it unsuitable for new entry despite the compelling momentum profile.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The stock has formed a golden cross, is above all major moving averages with RSI near 70, and is experiencing volume accumulation with rising on-balance volume, placing it in a confirmed technical breakout setup. Momentum breakdown | Price sustains above the 200-day moving average over the next 12 months with RSI consistently between 50 and 80, confirming the breakout has established a new trend. | →Stable |
| CounterAn RSI of 70 is at the overbought boundary, and stocks triggering a breakout from resistance often see a pullback to retest support; a 16% short interest could amplify both the upside and the reversal. | ||
Weis Markets scores 3.3 out of 10 on business quality, below the minimum acceptable threshold of 4.0, driven by negative free cash flow as a percentage of revenue and very low margins characteristic of the highly competitive grocery sector. Warnings | Business quality improves over 12 months with free cash flow turning positive as a percentage of revenue and gross margins expanding above current levels. | →Stable |
| CounterGrocery retailers structurally operate with thin margins and high inventory turnover; the quality score may be systematically low for the sector rather than reflecting a unique deterioration at Weis. | ||
The stock is trading above the resistance price target with no positive asymmetry remaining, meaning the current price exceeds the near-term fair value estimate and offers no margin of safety against the identified fundamental weaknesses. Gates warning | The price target is revised upward by more than 10% over 12 months to reflect improved earnings, reopening positive upside for the position. | →Stable |
| CounterA breakout above resistance can establish a new, higher trading range; the prior resistance level may become a support level and the stock could trade meaningfully higher without revisiting it. | ||
With approximately 16% of the float sold short, Weis Markets carries one of the higher short interest ratios in its sector, creating the potential for a short squeeze if positive news materializes and forces short sellers to cover. Risk breakdown | Short interest decreases to below 10% over 12 months as the price rise forces short covering, reducing this technical overhang. | →Stable |
| CounterHigh short interest in a low-quality grocery retailer often reflects fundamental concerns that are well-founded; short sellers in this sector tend to be patient and the short interest may reflect a structural view rather than a speculative position. | ||
The stock has formed a golden cross, is above all major moving averages with RSI near 70, and is experiencing volume accumulation with rising on-balance volume, placing it in a confirmed technical breakout setup.
→StableMomentum breakdown
- Expectation
- Price sustains above the 200-day moving average over the next 12 months with RSI consistently between 50 and 80, confirming the breakout has established a new trend.
CounterAn RSI of 70 is at the overbought boundary, and stocks triggering a breakout from resistance often see a pullback to retest support; a 16% short interest could amplify both the upside and the reversal.
Weis Markets scores 3.3 out of 10 on business quality, below the minimum acceptable threshold of 4.0, driven by negative free cash flow as a percentage of revenue and very low margins characteristic of the highly competitive grocery sector.
→StableWarnings
- Expectation
- Business quality improves over 12 months with free cash flow turning positive as a percentage of revenue and gross margins expanding above current levels.
CounterGrocery retailers structurally operate with thin margins and high inventory turnover; the quality score may be systematically low for the sector rather than reflecting a unique deterioration at Weis.
The stock is trading above the resistance price target with no positive asymmetry remaining, meaning the current price exceeds the near-term fair value estimate and offers no margin of safety against the identified fundamental weaknesses.
→StableGates warning
- Expectation
- The price target is revised upward by more than 10% over 12 months to reflect improved earnings, reopening positive upside for the position.
CounterA breakout above resistance can establish a new, higher trading range; the prior resistance level may become a support level and the stock could trade meaningfully higher without revisiting it.
With approximately 16% of the float sold short, Weis Markets carries one of the higher short interest ratios in its sector, creating the potential for a short squeeze if positive news materializes and forces short sellers to cover.
→StableRisk breakdown
- Expectation
- Short interest decreases to below 10% over 12 months as the price rise forces short covering, reducing this technical overhang.
CounterHigh short interest in a low-quality grocery retailer often reflects fundamental concerns that are well-founded; short sellers in this sector tend to be patient and the short interest may reflect a structural view rather than a speculative position.
Per-dimension breakdown
Quality
3.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.4 |
| ROA | 2.6 |
| Gross margin | 1.2 |
| Op margin | 1.1 |
| Net margin | 1.0 |
| Current ratio | 7.1 |
| FCF quality | 0.0 |
| Moat | 5.2 |
| Piotroski F | 8.9 |
- ▸Earnings quality RED FLAG: -6% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 8/9
Growth
6.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.7 |
| EPS growth | 10.0 |
Momentum
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.0 |
| MACD | 0.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 7.8 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
5.0/10data confidence 33%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.0 |
| quality rank | 4.0 |
| growth rank | 6.0 |
Technical
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.8 |
| support resistance | 2.8 |
| 52w position | 9.2 |
Risk (lower is worse)
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 1.8 |
| days to cover | 0.0 |
| volatility | 4.7 |
| put call | 10.0 |
| implied vol | 7.0 |
| max pain risk | 3.0 |
| beta | 10.0 |
| debt equity | 9.5 |
- ▸High short interest: 16%
- ▸Above max pain $70
Catalyst
3.4/10data confidence 100%| Component | Sub-score |
|---|---|
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| dividend safety | 5.2 |
- ▸Earnings concerns: 2B/2M
- ▸Dividend: 172.0%
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (7)
- MOMENTUM:6.4>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:42d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (1)
- ASYMMETRY:UPSIDE_EXHAUSTED (upside=0.0%)
Reward-to-Risk
0.00
Upside
+0.0%
Downside
10.6%
Sizing output
AVOID
SetupUNKNOWN — No clear chart pattern; technical signals are mixed
EdgeNO_EDGE — No clear edge identified
SuitabilityAGGRESSIVE — MCap $2.0B<$5B
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Value at 9.2 could not lift the engine output above the verdict floor.
The strongest dimensions are Value at 9.2, Growth at 6.8, and Momentum at 6.4; the weakest are Quality at 3.3, Catalyst at 3.4, and Peer rank at 4.5. The V9 engine cleared all gates with 1 warning, producing an asymmetric reward-to-risk of 0.00 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Weis Markets scores 3.3 out of 10 on business quality, below the minimum acceptable threshold of 4.0, driven by negative free cash flow as a percentage of revenue and very low margins characteristic of the highly competitive grocery sector.
Trip ifQuality score remains below 4.0 for more than 3 consecutive quarters, confirming structural weakness in the business model.
- P2The stock has formed a golden cross, is above all major moving averages with RSI near 70, and is experiencing volume accumulation with rising on-balance volume, placing it in a confirmed technical breakout setup.
Trip ifStock price drops below $70, more than 11% below the current $79.24, signaling the breakout has failed and reversed.
- P3With approximately 16% of the float sold short, Weis Markets carries one of the higher short interest ratios in its sector, creating the potential for a short squeeze if positive news materializes and forces short sellers to cover.
Trip ifShort interest rises above 20% of float, indicating bearish conviction has increased beyond the already-elevated current level.
- P4The stock is trading above the resistance price target with no positive asymmetry remaining, meaning the current price exceeds the near-term fair value estimate and offers no margin of safety against the identified fundamental weaknesses.
Trip ifPrice falls below $74, more than 6% below the current $79.24, reaching the defined stop-loss level near $74.64.