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.

Trade-Ideas LLC identified

Sanmina

(

SANM

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

  • SANM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $8.6 million.
  • SANM has traded 170,820 shares today.
  • SANM is trading at 4.88 times the normal volume for the stock at this time of day.
  • SANM is trading at a new low 6.01% 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 SANM:

Sanmina Corporation provides integrated manufacturing solutions, components, products and repair, logistics, and after-market services worldwide. SANM has a PE ratio of 10.9. Currently there are 2 analysts that rate Sanmina a buy, 1 analyst rates it a sell, and 2 rate it a hold.

The average volume for Sanmina has been 551,000 shares per day over the past 30 days. Sanmina has a market cap of $2.1 billion and is part of the technology sector and electronics industry. The stock has a beta of 1.26 and a short float of 1.7% with 3.83 days to cover. Shares are up 5.5% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Sanmina as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, notable return on equity, reasonable valuation levels and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 3.9%. Since the same quarter one year prior, revenues rose by 15.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • Compared to its closing price of one year ago, SANM's share price has jumped by 39.80%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, SANM should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, SANMINA CORP's return on equity exceeds that of both the industry average and the S&P 500.
  • SANMINA CORP reported flat earnings per share in the most recent quarter. 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, SANMINA CORP increased its bottom line by earning $2.26 versus $0.92 in the prior year. This year, the market expects an improvement in earnings ($2.30 versus $2.26).

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