Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
Trade-Ideas LLC identified
) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Francescas Holdings as such a stock due to the following factors:
- FRAN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $14.8 million.
- FRAN has traded 209,244 shares today.
- FRAN is trading at 2.55 times the normal volume for the stock at this time of day.
- FRAN is trading at a new low 3.04% 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 FRAN:
Francesca's Holdings Corporation, through its subsidiary, Francesca's Collections, Inc., operates a chain of retail boutiques. The company offers a selection of fashion apparel, jewelry, accessories, and gifts primarily for women between the ages of 18 and 35. FRAN has a PE ratio of 14.1. Currently there are 7 analysts that rate Francescas Holdings a buy, no analysts rate it a sell, and 6 rate it a hold.
The average volume for Francescas Holdings has been 923,900 shares per day over the past 30 days. Francescas has a market cap of $535.9 million and is part of the services sector and retail industry. The stock has a beta of 2.28 and a short float of 27.9% with 6.41 days to cover. Shares are down 35.6% year-to-date as of the close of trading on Friday.
rates Francescas Holdings as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and a generally disappointing performance in the stock itself.
Highlights from the ratings report include:
- FRAN's revenue growth has slightly outpaced the industry average of 0.0%. Since the same quarter one year prior, revenues slightly increased by 8.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- FRAN's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, FRAN has a quick ratio of 1.70, which demonstrates the ability of the company to cover short-term liquidity needs.
- 49.92% is the gross profit margin for FRANCESCAS HOLDINGS CORP which we consider to be strong. Regardless of FRAN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, FRAN's net profit margin of 10.59% compares favorably to the industry average.
- FRANCESCAS HOLDINGS CORP's earnings per share declined by 27.3% in the most recent quarter compared to the same quarter a year ago. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, FRANCESCAS HOLDINGS CORP reported lower earnings of $1.02 versus $1.05 in the prior year. For the next year, the market is expecting a contraction of 9.3% in earnings ($0.93 versus $1.02).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Specialty Retail industry. The net income has significantly decreased by 29.5% when compared to the same quarter one year ago, falling from $14.62 million to $10.31 million.
- You can view the full Francescas Holdings Ratings Report.