CompanyGraph
Use to find companies where this pattern is active.
Three observations describe the present configuration: the current close sits below the 40-week SMA (the conventional 'below 200-day SMA'), the company has reported positive net income in each of the last three annual periods, and operating cash flow exceeded net income in the most recent annual period.
State
Close below 40-week SMA with three-year profitability and an elevated OCF-to-net-income reading
Emergence
Three observations co-occur: the most recent close is below the 40-week simple moving average (the conventional 'below 200-day SMA' configuration), net income has been positive in each of the last three annual reporting periods, and operating cash flow exceeds net income in the most recent annual period. The configuration records present price-vs-trend position alongside two annual-fundamental readings.
Limits
This interpretation records a present-state combination, not a recovery call. The 'below 200-day SMA' framing is conventional vocabulary — the obs uses 40 weeks of weekly closes and scores the magnitude of the distance below. The 'ocf-to-net-income' obs measures only the OCF/Net-Income ratio for one annual period; it does not assess audit quality, revenue recognition aggression, or accruals composition. The price being below trend can persist for extended periods regardless of fundamental readings.
Explanation
Each observation is an independent reading: Close Below 200-Day (~40-Week) Simple Moving Average measures the percentage distance of the current close below the 40-week SMA. Score 0 means the close is at or above the SMA; score 100 means the close is 7% or more below. A firing score (>= 70) means the close is well below the SMA. Net Income Positive Every Year (3Y) confirms net income was positive in each of the last three fiscal years. Operating Cash Flow Relative to Net Income is the OCF/Net-Income ratio for the most recent annual period. Score 50 = ratio of 1.0; score 100 = ratio of 2.0 or higher. A firing score (>= 70) means OCF substantially exceeds net income in the latest year. The legacy 'ocf-to-net-income' label implies a verdict (good vs accounting-driven); the formula only records the OCF/Net-Income ratio for one annual period. When all three align, the configuration places the current close below the long-window SMA alongside two annual-fundamental readings. The observations do not predict recovery, claim the SMA configuration is mispriced, or assess whether the company will return to favor.
Interpretation
This interpretation records a co-occurring configuration of three observations, not a buying call. It does not predict price recovery, claim the SMA configuration is wrong, or assess investment merit. Price and fundamental observations can stay divergent for extended periods.
Required Observations
All Years Positive Income 3y
Net income was positive in each of the last N fiscal years
Below Sma 200d
How far the close is below the 200-day moving average
Ocf To Net Income
How operating cash flow compares to reported net income for the latest year.