Strong On High Relative Volume: NVIDIA (NVDA)

Trade-Ideas LLC identified NVIDIA (NVDA) as a strong on high relative volume candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

NVIDIA

(

NVDA

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

  • NVDA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $248.3 million.
  • NVDA has traded 5.6 million shares today.
  • NVDA is trading at 15.76 times the normal volume for the stock at this time of day.
  • NVDA is trading at a new high 13.03% 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 NVDA:

NVIDIA Corporation operates as a visual computing company in the United States, Taiwan, China, the rest of Asia Pacific, Europe, and other Americas. The company operates through two segments, GPU and Tegra Processors. The stock currently has a dividend yield of 1.4%. NVDA has a PE ratio of 3. Currently there are 7 analysts that rate NVIDIA a buy, 1 analyst rates it a sell, and 13 rate it a hold.

The average volume for NVIDIA has been 8.9 million shares per day over the past 30 days. NVIDIA has a market cap of $15.1 billion and is part of the technology sector and electronics industry. The stock has a beta of 0.88 and a short float of 9.9% with 5.46 days to cover. Shares are up 38.2% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates NVIDIA as a

buy

. 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, reasonable valuation levels, solid stock price performance and good cash flow from operations. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 12.9%. Since the same quarter one year prior, revenues slightly increased by 4.5%. 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 current debt-to-equity ratio, 0.34, is low and is below the industry average, implying that there has been successful management of debt levels. Along with this, the company maintains a quick ratio of 5.36, which clearly demonstrates the ability to cover short-term cash needs.
  • Compared to its closing price of one year ago, NVDA's share price has jumped by 47.23%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, NVDA should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Net operating cash flow has significantly increased by 69.29% to $163.00 million when compared to the same quarter last year. In addition, NVIDIA CORP has also vastly surpassed the industry average cash flow growth rate of -30.92%.

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