Pilgrims Pride (PPC) Stock: 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.
Trade-Ideas LLC identified
(
) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Pilgrims Pride as such a stock due to the following factors:
- PPC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $60.7 million.
- PPC has traded 336,874 shares today.
- PPC is trading at 3.24 times the normal volume for the stock at this time of day.
- PPC is trading at a new low 6.08% 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 PPC:
Pilgrim's Pride Corporation engages in the production, processing, marketing, and distribution of fresh, frozen, and value-added chicken products to retailers, distributors, and foodservice operators in the United States, Mexico, and Puerto Rico. PPC has a PE ratio of 9.8. Currently there are no analysts that rate Pilgrims Pride a buy, no analysts rate it a sell, and 2 rate it a hold.
The average volume for Pilgrims Pride has been 2.3 million shares per day over the past 30 days. Pilgrims Pride has a market cap of $7.0 billion and is part of the consumer goods sector and food & beverage industry. The stock has a beta of -0.17 and a short float of 58.6% with 14.99 days to cover. Shares are down 20.2% year-to-date as of the close of trading on Monday.
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Analysis:
rates Pilgrims Pride as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 10.1%. Since the same quarter one year prior, revenues slightly increased by 3.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- PPC's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.30, which illustrates the ability to avoid short-term cash problems.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 39.00% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, PPC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- PILGRIM'S PRIDE CORP has improved earnings per share by 16.4% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, PILGRIM'S PRIDE CORP increased its bottom line by earning $2.74 versus $2.12 in the prior year. This year, the market expects an improvement in earnings ($3.13 versus $2.74).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Food Products industry average. The net income increased by 16.6% when compared to the same quarter one year prior, going from $143.35 million to $167.19 million.
- You can view the full Pilgrims Pride Ratings Report.
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