Strong On High Relative Volume: Magna International (MGA)

Trade-Ideas LLC identified Magna International (MGA) as a strong on high relative volume candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Magna International

(

MGA

) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Magna International as such a stock due to the following factors:

  • MGA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $94.0 million.
  • MGA has traded 170,700 shares today.
  • MGA is trading at 2.86 times the normal volume for the stock at this time of day.
  • MGA is trading at a new high 3.04% 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 MGA:

Magna International Inc. develops, manufactures, engineers, supplies, and sells automotive products. It operates through North America, Europe, Asia, and Rest of World segments. The stock currently has a dividend yield of 3%. MGA has a PE ratio of 7. Currently there are 9 analysts that rate Magna International a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Magna International has been 1.6 million shares per day over the past 30 days. Magna International has a market cap of $13.4 billion and is part of the services sector and wholesale industry. Shares are down 16.4% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Magna International as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, attractive valuation levels and good cash flow from operations. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 0.3%. Since the same quarter one year prior, revenues rose by 14.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • MAGNA INTERNATIONAL INC has improved earnings per share by 10.9% 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, MAGNA INTERNATIONAL INC increased its bottom line by earning $4.71 versus $4.45 in the prior year. This year, the market expects an improvement in earnings ($5.07 versus $4.71).
  • 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 Auto Components industry average. The net income increased by 5.8% when compared to the same quarter one year prior, going from $465.00 million to $492.00 million.
  • Net operating cash flow has slightly increased to $298.00 million or 1.36% when compared to the same quarter last year. Despite an increase in cash flow of 1.36%, MAGNA INTERNATIONAL INC is still growing at a significantly lower rate than the industry average of 82.76%.

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