Trade-Ideas: ITC Holdings (ITC) Is Today's Weak On High Relative Volume Stock

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

Trade-Ideas LLC identified

ITC Holdings

(

ITC

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

  • ITC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $48.3 million.
  • ITC has traded 112,739 shares today.
  • ITC is trading at 3.26 times the normal volume for the stock at this time of day.
  • ITC 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 ITC:

ITC Holdings Corp., together with its subsidiaries, engages in the transmission of electricity in the United States. The stock currently has a dividend yield of 2.3%. ITC has a PE ratio of 2. Currently there are 6 analysts that rate ITC Holdings a buy, 1 analyst rates it a sell, and 4 rate it a hold.

The average volume for ITC Holdings has been 1.4 million shares per day over the past 30 days. ITC has a market cap of $5.2 billion and is part of the utilities sector and utilities industry. The stock has a beta of 0.06 and a short float of 3.5% with 3.49 days to cover. Shares are down 18.6% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates ITC Holdings as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, expanding profit margins and notable return on equity. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • ITC's revenue growth has slightly outpaced the industry average of 0.5%. Since the same quarter one year prior, revenues slightly increased by 4.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • ITC HOLDINGS CORP has improved earnings per share by 35.3% 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, ITC HOLDINGS CORP increased its bottom line by earning $1.54 versus $1.47 in the prior year. This year, the market expects an improvement in earnings ($2.08 versus $1.54).
  • 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 Electric Utilities industry average. The net income increased by 33.1% when compared to the same quarter one year prior, rising from $54.34 million to $72.34 million.
  • The gross profit margin for ITC HOLDINGS CORP is currently very high, coming in at 70.53%. Regardless of ITC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ITC's net profit margin of 26.29% significantly outperformed against the industry.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Electric Utilities industry and the overall market, ITC HOLDINGS CORP's return on equity exceeds that of both the industry average and the S&P 500.

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