Today's Weak On High Volume Stock: Denny's (DENN)
Trade-Ideas LLC identified
(
) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Denny's as such a stock due to the following factors:
- DENN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.3 million.
- DENN has traded 100,434 shares today.
- DENN is trading at 6.52 times the normal volume for the stock at this time of day.
- DENN is trading at a new low 3.07% 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 DENN:
Denny's Corporation, through its subsidiary, Denny's, Inc., owns and operates full-service restaurants under the Denny's brand name. DENN has a PE ratio of 27. Currently there are 2 analysts that rate Denny's a buy, no analysts rate it a sell, and 1 rates it a hold.
The average volume for Denny's has been 470,400 shares per day over the past 30 days. Denny's has a market cap of $928.6 million and is part of the services sector and leisure industry. The stock has a beta of 0.42 and a short float of 3.5% with 6.41 days to cover. Shares are up 7.4% year-to-date as of the close of trading on Tuesday.
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Analysis:
rates Denny's as a
. The company's strengths can be seen in multiple areas, such as its notable return on equity, revenue growth, good cash flow from operations, solid stock price performance and impressive record of earnings per share growth. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
Highlights from the ratings report include:
- Compared to other companies in the Hotels, Restaurants & Leisure industry and the overall market, DENNYS CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
- DENN's revenue growth has slightly outpaced the industry average of 1.2%. Since the same quarter one year prior, revenues slightly increased by 7.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 31.51% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, DENN should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- DENNYS CORP has improved earnings per share by 22.2% 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 two years. We feel that this trend should continue. During the past fiscal year, DENNYS CORP increased its bottom line by earning $0.37 versus $0.27 in the prior year. This year, the market expects an improvement in earnings ($0.44 versus $0.37).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Hotels, Restaurants & Leisure industry average. The net income increased by 17.6% when compared to the same quarter one year prior, going from $8.27 million to $9.73 million.
- You can view the full Denny's Ratings Report.
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