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Trade-Ideas LLC identified

Diebold

(

DBD

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

  • DBD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $12.6 million.
  • DBD has traded 317,368 shares today.
  • DBD is trading at 11.78 times the normal volume for the stock at this time of day.
  • DBD 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 DBD:

TheStreet Recommends

Diebold, Incorporated provides financial self-service delivery, integrated services and software, and security systems primarily to the financial, commercial, retail, and other markets. The stock currently has a dividend yield of 3.2%. DBD has a PE ratio of 33. Currently there are 2 analysts that rate Diebold a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Diebold has been 449,800 shares per day over the past 30 days. Diebold has a market cap of $2.4 billion and is part of the technology sector and computer hardware industry. The stock has a beta of 1.58 and a short float of 10% with 18.14 days to cover. Shares are up 8.3% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Diebold as a

buy

. The company's strengths can be seen in multiple areas, such as its notable return on equity and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • DIEBOLD INC's earnings per share declined by 35.3% 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, DIEBOLD INC turned its bottom line around by earning $1.76 versus -$2.85 in the prior year. This year, the market expects an improvement in earnings ($1.79 versus $1.76).
  • 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 Computers & Peripherals industry and the overall market on the basis of return on equity, DIEBOLD INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • The revenue fell significantly faster than the industry average of 25.6%. Since the same quarter one year prior, revenues fell by 11.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • After a year of stock price fluctuations, the net result is that DBD's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. 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.
  • The gross profit margin for DIEBOLD INC is currently lower than what is desirable, coming in at 27.17%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 3.18% significantly trails the industry average.

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