Trade-Ideas LLC identified

Spectranetics

(

SPNC

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

  • SPNC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.3 million.
  • SPNC has traded 172,466 shares today.
  • SPNC is trading at 7.81 times the normal volume for the stock at this time of day.
  • SPNC is trading at a new high 7.20% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into 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. 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 SPNC:

The Spectranetics Corporation, together with its subsidiaries, develops, manufactures, markets, and distributes single-use medical devices used in minimally invasive procedures in the cardiovascular system. Currently there are 10 analysts that rate Spectranetics a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Spectranetics has been 634,400 shares per day over the past 30 days. Spectranetics has a market cap of $544.5 million and is part of the health care sector and health services industry. The stock has a beta of 1.51 and a short float of 20.8% with 12.74 days to cover. Shares are down 15.1% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Spectranetics as a

sell

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

Highlights from the ratings report include:

  • 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 Health Care Equipment & Supplies industry and the overall market, SPECTRANETICS CORP'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 -$10.23 million or 200.47% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • SPECTRANETICS CORP' earnings per share from the most recent quarter came in slightly below the year earlier quarter. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, SPECTRANETICS CORP reported poor results of -$0.95 versus -$0.02 in the prior year. For the next year, the market is expecting a contraction of 1.1% in earnings (-$0.96 versus -$0.95).
  • Looking at the price performance of SPNC's shares over the past 12 months, there is not much good news to report: the stock is down 62.81%, 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. 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.
  • The debt-to-equity ratio is very high at 2.01 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, SPNC's quick ratio is somewhat strong at 1.15, demonstrating the ability to handle short-term liquidity needs.

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