Trade-Ideas LLC identified

KapStone Paper And Packaging

(

KS

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

  • KS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $12.3 million.
  • KS has traded 51,506 shares today.
  • KS is trading at 2.28 times the normal volume for the stock at this time of day.
  • KS is trading at a new low 3.05% 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.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in KS with the Ticky from Trade-Ideas. See the FREE profile for KS NOW at Trade-Ideas

More details on KS:

TheStreet Recommends

KapStone Paper and Packaging Corporation manufactures and sells containerboards, corrugated products, and specialty paper products in the United States and internationally. The stock currently has a dividend yield of 1.8%. KS has a PE ratio of 17. Currently there are 6 analysts that rate KapStone Paper And Packaging a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for KapStone Paper And Packaging has been 842,300 shares per day over the past 30 days. KapStone Paper And Packaging has a market cap of $2.1 billion and is part of the consumer goods sector and consumer non-durables industry. The stock has a beta of 2.23 and a short float of 3.6% with 4.99 days to cover. Shares are down 10.1% year-to-date as of the close of trading on Wednesday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates KapStone Paper And Packaging as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and notable return on equity. We feel its strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 11.8%. Since the same quarter one year prior, revenues rose by 35.0%. 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.
  • Net operating cash flow has slightly increased to $104.06 million or 6.84% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -28.38%.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Paper & Forest Products industry and the overall market, KAPSTONE PAPER & PACKAGING's return on equity exceeds that of both the industry average and the S&P 500.
  • KAPSTONE PAPER & PACKAGING's earnings per share declined by 37.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, KAPSTONE PAPER & PACKAGING increased its bottom line by earning $1.77 versus $1.32 in the prior year. For the next year, the market is expecting a contraction of 8.2% in earnings ($1.63 versus $1.77).
  • The change in net income from the same quarter one year ago has exceeded that of the Paper & Forest Products industry average, but is less than that of the S&P 500. The net income has significantly decreased by 37.0% when compared to the same quarter one year ago, falling from $54.25 million to $34.21 million.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.