Kellogg (K) Highlighted As Weak On High Volume
Trade-Ideas LLC identified
(
) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Kellogg as such a stock due to the following factors:
- K has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $301.5 million.
- K has traded 1.8 million shares today.
- K is trading at 15.46 times the normal volume for the stock at this time of day.
- K is trading at a new low 4.00% 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 K:
Kellogg Company manufactures and markets ready-to-eat cereal and convenience foods. It operates through U.S. Morning Foods, U.S. Snacks, U.S. Specialty, North America Other, Europe, Latin America, and Asia Pacific segments. The stock currently has a dividend yield of 2.3%. K has a PE ratio of 55. Currently there are 2 analysts that rate Kellogg a buy, 3 analysts rate it a sell, and 9 rate it a hold.
The average volume for Kellogg has been 2.5 million shares per day over the past 30 days. Kellogg has a market cap of $30.0 billion and is part of the consumer goods sector and food & beverage industry. The stock has a beta of 0.50 and a short float of 2.4% with 1.45 days to cover. Shares are up 20.4% year-to-date as of the close of trading on Tuesday.
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Analysis:
rates Kellogg as a
. The company's strengths can be seen in multiple areas, such as its notable return on equity, expanding profit margins and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Food Products industry and the overall market, KELLOGG CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
- 40.83% is the gross profit margin for KELLOGG CO which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 5.17% trails the industry average.
- Compared to its closing price of one year ago, K's share price has jumped by 33.06%, exceeding the performance of the broader market during that same time frame. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- KELLOGG CO's earnings per share declined by 23.4% in the most recent quarter compared to the same quarter a year ago. Stable earnings per share over the past year indicate the company has sound management over its earnings and share float. We anticipate these figures will begin to experience more growth in the coming year. During the past fiscal year, KELLOGG CO reported lower earnings of $1.73 versus $1.74 in the prior year. This year, the market expects an improvement in earnings ($3.69 versus $1.73).
- K, with its decline in revenue, underperformed when compared the industry average of 16.4%. Since the same quarter one year prior, revenues slightly dropped by 5.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- You can view the full Kellogg Ratings Report.
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