Joy Global (JOY) Is Weak On High Volume Today
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
Trade-Ideas LLC identified
(
) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Joy Global as such a stock due to the following factors:
- JOY has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $38.3 million.
- JOY has traded 1.3 million shares today.
- JOY is trading at 28.02 times the normal volume for the stock at this time of day.
- JOY is trading at a new low 8.02% below yesterday's close.
'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of 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 (or avoid losses by trimming weak positions). 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 JOY:
Joy Global Inc. manufactures and services mining equipment for the extraction of coal, copper, iron ore, oil sands, gold, and other minerals. It operates in two segments, Underground Mining Machinery and Surface Mining Equipment. The stock currently has a dividend yield of 1.9%. JOY has a PE ratio of 13.1. Currently there are 3 analysts that rate Joy Global a buy, no analysts rate it a sell, and 14 rate it a hold.
The average volume for Joy Global has been 1.5 million shares per day over the past 30 days. Joy Global has a market cap of $4.2 billion and is part of the industrial goods sector and industrial industry. The stock has a beta of 1.36 and a short float of 12.6% with 12.34 days to cover. Shares are down 9.4% year-to-date as of the close of trading on Wednesday.
Analysis:
rates Joy Global as a
. The company's strengths can be seen in multiple areas, such as its increase in net income, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and a generally disappointing performance in the stock itself.
Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Machinery industry. The net income increased by 410.3% when compared to the same quarter one year prior, rising from $26.83 million to $136.94 million.
- The current debt-to-equity ratio, 0.45, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.13, which illustrates the ability to avoid short-term cash problems.
- JOY, with its decline in revenue, slightly underperformed the industry average of 1.4%. Since the same quarter one year prior, revenues slightly dropped by 4.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- Net operating cash flow has significantly decreased to $65.12 million or 66.65% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. When compared to other companies in the Machinery industry and the overall market, JOY GLOBAL INC's return on equity is below that of both the industry average and the S&P 500.
- You can view the full Joy Global Ratings Report.
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