Trade-Ideas: Comfort Systems USA (FIX) Is Today's Strong On High Relative Volume Stock
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 Comfort Systems USA as such a stock due to the following factors:
- FIX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.3 million.
- FIX has traded 85,644 shares today.
- FIX is trading at 15.57 times the normal volume for the stock at this time of day.
- FIX is trading at a new high 3.16% 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 FIX:
Comfort Systems USA, Inc. provides installation, maintenance, repair, and replacement services for heating, ventilation, and air conditioning (HVAC) systems in the mechanical services industry. The stock currently has a dividend yield of 1.3%. FIX has a PE ratio of 30.9. Currently there is 1 analyst that rates Comfort Systems USA a buy, no analysts rate it a sell, and 2 rate it a hold.
The average volume for Comfort Systems USA has been 154,300 shares per day over the past 30 days. Comfort Systems USA has a market cap of $702.2 million and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 1.55 and a short float of 3.2% with 4.02 days to cover. Shares are up 10.8% year-to-date as of the close of trading on Wednesday.
Analysis:
rates Comfort Systems USA as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, increase in net income, solid stock price performance and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 3.8%. Since the same quarter one year prior, revenues slightly increased by 7.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- FIX's debt-to-equity ratio is very low at 0.13 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.34, which illustrates the ability to avoid short-term cash problems.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Construction & Engineering industry. The net income increased by 90.9% when compared to the same quarter one year prior, rising from $5.60 million to $10.68 million.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
- COMFORT SYSTEMS USA INC 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, COMFORT SYSTEMS USA INC reported lower earnings of $0.62 versus $0.73 in the prior year. This year, the market expects an improvement in earnings ($0.83 versus $0.62).
- You can view the full Comfort Systems USA Ratings Report.
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