Strong On High Volume: Lumber Liquidators Holdings (LL)
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 Lumber Liquidators Holdings as such a stock due to the following factors:
- LL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $363.5 million
- LL has traded 5.3 million shares today
- LL is trading at 22.44 times the normal volume for the stock at this time of day
- LL is trading at a new high 11.019677422657000676053939969278872013092041015625 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 LL:
Lumber Liquidators Holdings, Inc., together with its subsidiaries, operates as a multi-channel specialty retailer of hardwood flooring, and hardwood flooring enhancements and accessories. LL has a PE ratio of 19.8299999999999982946974341757595539093017578125. Currently there are two analysts that rate Lumber Liquidators Holdings a buy, no analysts rate it a sell, and nine rate it a hold.
The average volume for Lumber Liquidators Holdings has been 2.3 million shares per day over the past 30 days. Lumber Liquidators has a market cap of $901.9 million and is part of the services sector and retail industry. The stock has a beta of 1.57 and a short float of 47.1% with 0.67 days to cover. Shares are down 57.9% year-to-date as of the close of trading on Monday.
Analysis:
rates Lumber Liquidators Holdings as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Highlights from the ratings report include:
- Despite its growing revenue, the company underperformed as compared with the industry average of 14.2%. Since the same quarter one year prior, revenues slightly increased by 5.2%. 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.
- Net operating cash flow has significantly increased by 51.26% to $24.65 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 9.17%.
- LL 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. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.14 is very weak and demonstrates a lack of ability to pay short-term obligations.
- 39.15% is the gross profit margin for LUMBER LIQUIDATORS HLDGS INC which we consider to be strong. Regardless of LL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 6.37% trails the industry average.
- You can view the full Lumber Liquidators Holdings Ratings Report
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