SunOpta (STKL) Is Strong On High Volume Today

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

Trade-Ideas LLC identified

SunOpta

(

STKL

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

  • STKL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.5 million.
  • STKL has traded 196,778 shares today.
  • STKL is trading at 4.84 times the normal volume for the stock at this time of day.
  • STKL is trading at a new high 3.14% 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 STKL:

SunOpta Inc. sources, processes, packages, and markets natural, organic, and specialty food products in the United States, Canada, Europe, China, and Ethiopia. STKL has a PE ratio of 95. Currently there are 3 analysts that rate SunOpta a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for SunOpta has been 1.1 million shares per day over the past 30 days. SunOpta has a market cap of $570.1 million and is part of the consumer goods sector and food & beverage industry. The stock has a beta of 2.36 and a short float of 2.2% with 1.13 days to cover. Shares are down 40.8% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates SunOpta as a

hold

. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, increase in net income and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:

  • SUNOPTA INC reported significant earnings per share improvement 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 year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, SUNOPTA INC turned its bottom line around by earning $0.17 versus -$0.13 in the prior year. This year, the market expects an improvement in earnings ($0.29 versus $0.17).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Food Products industry. The net income increased by 181.8% when compared to the same quarter one year prior, rising from -$0.38 million to $0.31 million.
  • The current debt-to-equity ratio, 0.33, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.79 is somewhat weak and could be cause for future problems.
  • The gross profit margin for SUNOPTA INC is currently extremely low, coming in at 12.57%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.10% significantly trails the industry average.
  • STKL's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 48.56%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Although its share price is down sharply from a year ago, do not assume that it can now be tagged as cheap and attractive. The reality is that, based on its current price in relation to its earnings, STKL is still more expensive than most of the other companies in its industry.

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