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One way to help determine whether a company has healthy operations is by looking at its operating expenses relative to cash holdings. Companies with strong cash coverage of expenses have more sustainable operations.

We ran a screen on technically oversold stocks (with RSI(14) below 40) for those with strong cash coverage of their operating expenses last year.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Do you think these stocks are oversold? Use this list as a starting-off point for your own analysis.

List sorted by RSI(14).

1. Augusta Resource Corp. (NYSEMKT:AZC): Engages in the acquisition, exploration, and development of natural mineral resource properties. Market cap of $500.57M. RSI(14) at 32.79. MRQ cash at $50.52M vs. last year operating expenses at $6.08M. This is a risky stock that is significantly more volatile than the overall market (beta = 2.15). The stock is currently stuck in a downtrend, trading 8.35% below its SMA20, 20.36% below its SMA50, and 21.72% below its SMA200. It's been a rough couple of days for the stock, losing 6.67% over the last week.

2. Renren Inc. American Depositary (NYSE:RENN): Operates a social networking Internet platform in China. Market cap of $870.06M. RSI(14) at 33.48. MRQ cash at $1.23B vs. last year operating expenses at $68.81M. The stock is currently stuck in a downtrend, trading 6.54% below its SMA20, 22.38% below its SMA50, and 31.71% below its SMA200. It's been a rough couple of days for the stock, losing 7.63% over the last week.

3. International Tower Hill Mines Ltd. (NYSEMKT:THM): Engages in the acquisition, exploration, and development of mineral properties in Alaska and Nevada. Market cap of $621.50M. RSI(14) at 33.52. MRQ cash at $112.79M vs. last year operating expenses at $10.73M. The stock is currently stuck in a downtrend, trading 9.61% below its SMA20, 7.89% below its SMA50, and 17.11% below its SMA200. It's been a rough couple of days for the stock, losing 9.24% over the last week.

4. Avalon Rare Metals Inc. (NYSEMKT:AVL): Engages in the exploration and development of rare metal deposits in Canada. Market cap of $407.20M. RSI(14) at 36.75. MRQ cash at $31.72M vs. last year operating expenses at $4.91M. This is a risky stock that is significantly more volatile than the overall market (beta = 2.43). The stock is currently stuck in a downtrend, trading 5.46% below its SMA20, 21.63% below its SMA50, and 38.34% below its SMA200. It's been a rough couple of days for the stock, losing 7.03% over the last week.

5. Youku.com Inc (NYSE:YOKU): Operates as an Internet television company in the People's Republic of China. Market cap of $2.40B. RSI(14) at 37.66. MRQ cash at $631.05M vs. last year operating expenses at $84.18M. The stock is currently stuck in a downtrend, trading 9.24% below its SMA20, 26.42% below its SMA50, and 44.45% below its SMA200. The stock has performed poorly over the last month, losing 11.79%.

6. Giant Interactive Group, Inc. (NYSE:GA): Develops and operates online games in the People's Republic of China. Market cap of $995.86M. RSI(14) at 38.67. MRQ cash at $815.54M vs. last year operating expenses at $99.66M. The stock is currently stuck in a downtrend, trading 10.57% below its SMA20, 9.14% below its SMA50, and 7.06% below its SMA200. It's been a rough couple of days for the stock, losing 11.27% over the last week.

7. Qihoo 360 Technology Co. Ltd. A (NYSE:QIHU): Provides Internet and mobile security products in the People's Republic of China. Market cap of $2.46B. RSI(14) at 39.43. MRQ cash at $309.43M vs. last year operating expenses at $48.64M. The stock is a short squeeze candidate, with a short float at 6.71% (equivalent to 5.23 days of average volume). It's been a rough couple of days for the stock, losing 6.43% over the last week.

*Cash and operating expenses data sourced from Screener.co, all other data sourced from Finviz.

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

Source: 7 Oversold Stocks With Excellent Cash Coverage Of Operating Expenses