Today's Weak On High Volume Stock: Stratasys (SSYS)

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

Trade-Ideas LLC identified

Stratasys

(

SSYS

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

  • SSYS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $19.6 million.
  • SSYS has traded 446,904 shares today.
  • SSYS is trading at 10.22 times the normal volume for the stock at this time of day.
  • SSYS is trading at a new low 11.03% 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 SSYS:

Stratasys Ltd. provides three-dimensional (3D) printing and additive manufacturing (AM) solutions for the creation of parts used in the processes of designing and manufacturing products; and for the direct manufacture of end parts. Currently there are 6 analysts that rate Stratasys a buy, 3 analysts rate it a sell, and 6 rate it a hold.

The average volume for Stratasys has been 1.1 million shares per day over the past 30 days. Stratasys has a market cap of $1.2 billion and is part of the technology sector and computer hardware industry. The stock has a beta of 1.42 and a short float of 17.6% with 8.05 days to cover. Shares are down 0.8% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Stratasys as a

sell

. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Computers & Peripherals industry and the overall market, STRATASYS LTD's return on equity significantly trails that of both the industry average and the S&P 500.
  • SSYS'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 32.03%, 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. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 12.8%. Since the same quarter one year prior, revenues slightly dropped by 2.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • STRATASYS LTD reported significant earnings per share improvement 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, STRATASYS LTD reported poor results of -$26.60 versus -$2.35 in the prior year. This year, the market expects an improvement in earnings ($0.32 versus -$26.60).
  • The gross profit margin for STRATASYS LTD is rather high; currently it is at 62.42%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -13.78% is in-line with the industry average.

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