Today's Weak On High Volume Stock: AtriCure (ATRC)

Trade-Ideas LLC identified AtriCure (ATRC) as a weak on high relative volume candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

AtriCure

(

ATRC

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

  • ATRC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.8 million.
  • ATRC has traded 70,947 shares today.
  • ATRC is trading at 7.49 times the normal volume for the stock at this time of day.
  • ATRC is trading at a new low 3.24% below yesterday's close.

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of 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 (or avoid losses by trimming weak positions). 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 ATRC:

AtriCure, Inc., a medical device company, provides atrial fibrillation solutions worldwide. Currently there are 7 analysts that rate AtriCure a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for AtriCure has been 260,600 shares per day over the past 30 days. AtriCure has a market cap of $528.7 million and is part of the health care sector and health services industry. The stock has a beta of 1.43 and a short float of 10.2% with 10.63 days to cover. Shares are down 2.6% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates AtriCure as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:

  • ATRC's revenue growth trails the industry average of 37.7%. Since the same quarter one year prior, revenues rose by 17.8%. 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.
  • ATRC's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, ATRC has a quick ratio of 1.67, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Health Care Equipment & Supplies industry. The net income has significantly decreased by 1217.8% when compared to the same quarter one year ago, falling from -$0.47 million to -$6.14 million.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Health Care Equipment & Supplies industry and the overall market, ATRICURE INC's return on equity significantly trails that of both the industry average and the S&P 500.

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