Trade-Ideas LLC identified

Platform Specialty Products

(

PAH

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

  • PAH has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $15.9 million.
  • PAH has traded 311,494 shares today.
  • PAH is trading at 6.14 times the normal volume for the stock at this time of day.
  • PAH is trading at a new low 4.04% 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 PAH:

Platform Specialty Products Corporation produces and sells specialty chemical products in the Americas, the Asia-Pacific, and Europe. It operates through two segments, Performance Solutions and Agricultural Solutions. Currently there is 1 analyst that rates Platform Specialty Products a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Platform Specialty Products has been 2.1 million shares per day over the past 30 days. Platform Specialty has a market cap of $2.0 billion and is part of the basic materials sector and chemicals industry. Shares are down 36.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Platform Specialty Products as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow, generally high debt management risk and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • 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 Chemicals industry. The net income has significantly decreased by 404.9% when compared to the same quarter one year ago, falling from -$26.70 million to -$134.80 million.
  • 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. Compared to other companies in the Chemicals industry and the overall market, PLATFORM SPECIALTY PRODUCTS's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to -$210.40 million or 200.35% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Currently the debt-to-equity ratio of 1.86 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Even though the debt-to-equity ratio is weak, PAH's quick ratio is somewhat strong at 1.28, demonstrating the ability to handle short-term liquidity needs.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 65.29%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 321.42% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

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