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

  • FBP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $3.1 million.
  • FBP has traded 85,075 shares today.
  • FBP is trading at 3.41 times the normal volume for the stock at this time of day.
  • FBP is trading at a new low 4.07% 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 FBP: First BanCorp. operates as the bank holding company for FirstBank Puerto Rico that provides a range of financial products and services to retail, commercial, and institutional clients. FBP has a PE ratio of 43. Currently there are 3 analysts that rate First BanCorp a buy, no analysts rate it a sell, and 1 rates it a hold. The average volume for First BanCorp has been 829,200 shares per day over the past 30 days. First BanCorp has a market cap of $839.3 million and is part of the financial sector and banking industry. The stock has a beta of 1.91 and a short float of 3.1% with 4.94 days to cover. Shares are up 20.9% year-to-date as of the close of trading on Monday.

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TheStreet Recommends

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates First BanCorp as a

hold

. Among the primary strengths of the company is its expanding profit margins over time. At the same time, however, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and feeble growth in the company's earnings per share. Highlights from the ratings report include:

  • The gross profit margin for FIRST BANCORP P R is currently very high, coming in at 71.39%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 14.14% trails the industry average.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 6.7%. Since the same quarter one year prior, revenues slightly dropped by 3.9%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500 and the Commercial Banks industry average. The net income has decreased by 9.0% when compared to the same quarter one year ago, dropping from $25.65 million to $23.34 million.
  • Looking at the price performance of FBP's shares over the past 12 months, there is not much good news to report: the stock is down 37.59%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Commercial Banks industry and the overall market on the basis of return on equity, FIRST BANCORP P R underperformed against that of the industry average and is significantly less than that of the S&P 500.

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