Trade-Ideas LLC identified

Beazer Homes USA

(

BZH

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

  • BZH has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.6 million.
  • BZH has traded 264,165 shares today.
  • BZH is trading at 12.50 times the normal volume for the stock at this time of day.
  • BZH is trading at a new high 5.10% 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 BZH:

Beazer Homes USA, Inc. operates as a homebuilder in the United States. The company designs, constructs, and sells single-family and multi-family homes for entry-level, move-up, or retirement-oriented home buyers under the Beazer Homes brand name. BZH has a PE ratio of 1. Currently there are 4 analysts that rate Beazer Homes USA a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Beazer Homes USA has been 669,500 shares per day over the past 30 days. Beazer Homes USA has a market cap of $300.8 million and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 2.53 and a short float of 17.9% with 10.55 days to cover. Shares are down 19.8% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Beazer Homes USA as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, poor profit margins and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 2.9%. Since the same quarter one year prior, revenues rose by 28.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Household Durables industry and the overall market, BEAZER HOMES USA INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • BEAZER HOMES USA INC reported significant earnings per share improvement 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. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, BEAZER HOMES USA INC increased its bottom line by earning $10.78 versus $0.92 in the prior year. For the next year, the market is expecting a contraction of 93.7% in earnings ($0.68 versus $10.78).
  • The gross profit margin for BEAZER HOMES USA INC is rather low; currently it is at 15.45%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -0.32% trails that of the industry average.
  • The debt-to-equity ratio is very high at 2.30 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.

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