Strong On High Relative Volume: Winnebago Industries (WGO)
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 strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Winnebago Industries as such a stock due to the following factors:
- WGO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.2 million.
- WGO has traded 66,734 shares today.
- WGO is trading at 4.85 times the normal volume for the stock at this time of day.
- WGO is trading at a new high 4.03% 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 WGO:
Winnebago Industries, Inc. manufactures and sells recreation vehicles primarily for use in leisure travel and outdoor recreation activities. The stock currently has a dividend yield of 1.6%. WGO has a PE ratio of 14.0. Currently there are 2 analysts that rate Winnebago Industries a buy, no analysts rate it a sell, and 2 rate it a hold.
The average volume for Winnebago Industries has been 498,400 shares per day over the past 30 days. Winnebago has a market cap of $606.5 million and is part of the consumer goods sector and automotive industry. The stock has a beta of 2.45 and a short float of 17.1% with 10.25 days to cover. Shares are up 2.7% year-to-date as of the close of trading on Thursday.
Analysis:
rates Winnebago Industries as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. We feel these 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 10.1%. Since the same quarter one year prior, revenues slightly increased by 0.8%. 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 return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Automobiles industry and the overall market, WINNEBAGO INDUSTRIES's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
- WGO has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.96 is somewhat weak and could be cause for future problems.
- WINNEBAGO INDUSTRIES's earnings per share declined by 7.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, WINNEBAGO INDUSTRIES increased its bottom line by earning $1.65 versus $1.13 in the prior year. This year, the market expects an improvement in earnings ($1.70 versus $1.65).
- You can view the full Winnebago Industries Ratings Report.
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