Trade-Ideas LLC identified

Canon

(

CAJ

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

  • CAJ has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $6.0 million.
  • CAJ has traded 100,992 shares today.
  • CAJ is trading at 9.78 times the normal volume for the stock at this time of day.
  • CAJ is trading at a new low 6.03% 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 CAJ:

TheStreet Recommends

Canon Inc. manufactures and sells office multifunction devices (MFDs), plain paper copying machines, laser printers, inkjet printers, cameras, and lithography equipment. The stock currently has a dividend yield of 3.8%. CAJ has a PE ratio of 13. Currently there are no analysts that rate Canon a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Canon has been 206,800 shares per day over the past 30 days. Canon has a market cap of $34.7 billion and is part of the consumer goods sector and consumer durables industry. Shares are up 0.2% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Canon as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:

  • CAJ's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
  • The gross profit margin for CANON INC is rather high; currently it is at 58.64%. Regardless of CAJ's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, CAJ's net profit margin of 7.04% is significantly lower than the industry average.
  • 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. In comparison to the other companies in the Computers & Peripherals industry and the overall market, CANON INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • Net operating cash flow has decreased to $1,011.35 million or 37.70% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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