AutoNation (AN) Is Strong On High Volume Today
Trade-Ideas LLC identified
(
) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified AutoNation as such a stock due to the following factors:
- AN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $76.6 million.
- AN has traded 100,153 shares today.
- AN is trading at 2.72 times the normal volume for the stock at this time of day.
- AN is trading at a new high 4.02% above yesterday's close.
'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.
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More details on AN:
AutoNation, Inc., through its subsidiaries, operates as an automotive retailer in the United States. The company operates in three segments: Domestic, Import, and Premium Luxury. AN has a PE ratio of 12. Currently there are 4 analysts that rate AutoNation a buy, no analysts rate it a sell, and 6 rate it a hold.
The average volume for AutoNation has been 1.4 million shares per day over the past 30 days. AutoNation has a market cap of $4.8 billion and is part of the services sector and specialty retail industry. The stock has a beta of 1.03 and a short float of 14.1% with 6.05 days to cover. Shares are down 18.3% year-to-date as of the close of trading on Thursday.
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Analysis:
rates AutoNation as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, attractive valuation levels and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and poor profit margins.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 7.5%. Since the same quarter one year prior, revenues slightly increased by 3.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Specialty Retail industry and the overall market on the basis of return on equity, AUTONATION INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Specialty Retail industry average. The net income has decreased by 14.0% when compared to the same quarter one year ago, dropping from $111.50 million to $95.90 million.
- The debt-to-equity ratio is very high at 3.21 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.14, which clearly demonstrates the inability to cover short-term cash needs.
- You can view the full AutoNation Ratings Report.
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