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If you're looking for potential short ideas, the following list might offer an interesting starting point.

Listed below are twenty stocks that have seen the 50-day moving average cross below the 200-day MA, a bearish signal known as the “Death Cross.” These companies also have insufficient cash to cover more than 2 quarters of their past year’s average quarterly operating expense.

We calculated the average quarterly operating expense over the last four quarters, and compared it with current cash holdings for each firm. All companies listed below have less than 2x the cash for their avg. quarterly operating expense, translating into coverage of less than 2 quarters of avg. operating expenses.

Do you think these companies can soon bounce back, or are these trends only the beginning? Read below, using this list as a starting-off point for your own analysis.

Operating expenses and cash data from Google finance, all other data from Finviz.

Click for expanded images:


List sorted by Cash/Avg. Quarterly Operating Expense ratio.

1. Target Corp. (NYSE:TGT): Discount, Variety Stores Industry. Market cap of $35.0B. SMA50 at $53.14 vs. SMA200 at $53.39 (current price at $50.30). Current cash holdings at $1.71B vs. average quarterly operating expenses over the last four quarters at $15.72B. Cash/Avg. Quarterly Operating Expense ratio at 0.1. The stock has lost 4.66% over the last year.

2. Lance, Inc. (NASDAQ:LNCE):
Processed & Packaged Goods Industry. Market cap of $1.30B. SMA50 at $19.96 vs. SMA200 at $20.87 (current price at $19.47). Current cash holdings at $27.88M vs. average quarterly operating expenses over the last four quarters at $241.94M. Cash/Avg. Quarterly Operating Expense ratio at 0.1. LNCE has a relatively low correlation to the market (beta = 0.57), which may be appealing to risk-averse investors. The stock has had a couple of great days, gaining 6.54% over the last week.

3. PAETEC Holding Corp. (NASDAQ:PAET): Diversified Communication Services Industry. Market cap of $458.83M. SMA50 at $3.86 vs. SMA200 at $3.92 (current price at $3.12). Current cash holdings at $125.28M vs. average quarterly operating expenses over the last four quarters at $396.66M. Cash/Avg. Quarterly Operating Expense ratio at 0.3. This is a risky stock that is significantly more volatile than the overall market (beta = 2.35). PAET is currently stuck in a downtrend, trading 13.36% below its SMA20, 19.27% below its SMA50, and 20.48% below its SMA200. It's been a rough couple of days for the stock, losing 6.49% over the last week.

4. Schweitzer-Mauduit International Inc. (NYSE:SWM): Paper & Paper Products Industry. Market cap of $913.66M. SMA50 at $57.09 vs. SMA200 at $57.23 (current price at $52.01). Current cash holdings at $87.30M vs. average quarterly operating expenses over the last four quarters at $198.63M. Cash/Avg. Quarterly Operating Expense ratio at 0.4. The stock has performed poorly over the last month, losing 10.94%.

5. TNS Inc. (NYSE:TNS): Communication Equipment Industry. Market cap of $382.30M. SMA50 at $17.46 vs. SMA200 at $17.97 (current price at $15.00). Current cash holdings at $56.69M vs. average quarterly operating expenses over the last four quarters at $121.33M. Cash/Avg. Quarterly Operating Expense ratio at 0.5. TNS is a risky stock that is significantly more volatile than the overall market (beta = 2.14). The stock is stuck in a downtrend, trading 6.01% below its SMA20, 14.08% below its SMA50, and 16.52% below its SMA200. The stock has lost 20.79% over the last month.

6. Cedar Shopping Centers Inc. (NYSE:CDR): REIT. Market cap of $389.43M. SMA50 at $5.90 vs. SMA200 at $5.95 (current price at $5.70). Current cash holdings at $14.17M vs. average quarterly operating expenses over the last four quarters at $28.11M. Cash/Avg. Quarterly Operating Expense ratio at 0.5. The stock has had a couple of great days, gaining 9.29% over the last week.

7. US Airways Group, Inc. (LCC):
Major Airlines Industry. Market cap of $1.44B. SMA50 at $9.55 vs. SMA200 at $9.87 (current price at $8.77). Current cash holdings at $1.86B vs. average quarterly operating expenses over the last four quarters at $2.78B. Cash/Avg. Quarterly Operating Expense ratio at 0.7. The stock has gained 20.43% over the last year.

8. WMS Industries Inc. (NYSE:WMS-OLD): Recreational Goods Industry. Market cap of $2.06B. SMA50 at $41.13 vs. SMA200 at $41.26 (current price at $35.75). Current cash holdings at $106.80M vs. average quarterly operating expenses over the last four quarters at $158.85M. Cash/Avg. Quarterly Operating Expense ratio at 0.7. Short float at 9.28% (equivalent to 5.86 days of average volume), implying the stock is a short squeeze candidate. The stock has performed poorly over the last month, losing 14.81%.

9. Blackboard Inc. (NASDAQ:BBBB): Multimedia & Graphics Software Industry. Market cap of $1.23B. SMA50 at $37.60 vs. SMA200 at $38.54 (current price at $35.60). Current cash holdings at $70.31M vs. average quarterly operating expenses over the last four quarters at $103.33M. Cash/Avg. Quarterly Operating Expense ratio at 0.7. The stock is a short squeeze candidate, with a short float at 39.1% (equivalent to 28.13 days of average volume). The stock has lost 19.4% over the last year.

10. Renaissance Learning Inc. (NASDAQ:RLRN): Multimedia & Graphics Software Industry. Market cap of $326.0M. SMA50 at $10.87 vs. SMA200 at $10.88 (current price at $11.75). Current cash holdings at $16.48M vs. average quarterly operating expenses over the last four quarters at $23.96M. Cash/Avg. Quarterly Operating Expense ratio at 0.7. Short float at 5.3% (equivalent to 7.5 days of average volume), implying the stock is a short squeeze candidate. The stock has had a couple of great days, gaining 6.81% over the last week.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 10 Downtrending Stocks with Low Cash to Operating Expenses