Trade-Ideas LLC identified

Applied Micro Circuits

(

AMCC

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

  • AMCC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.7 million.
  • AMCC has traded 140,093 shares today.
  • AMCC is trading at 5.35 times the normal volume for the stock at this time of day.
  • AMCC is trading at a new high 3.07% 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 AMCC:

Applied Micro Circuits Corporation provides silicon solutions for next-generation cloud infrastructure and data centers; and connectivity products for edge, metro, and long haul communications equipment in the United States and internationally. Currently there are 2 analysts that rate Applied Micro Circuits a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Applied Micro Circuits has been 675,000 shares per day over the past 30 days. Applied Micro Circuits has a market cap of $507.0 million and is part of the technology sector and electronics industry. The stock has a beta of 2.20 and a short float of 13.1% with 18.44 days to cover. Shares are down 3% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Applied Micro Circuits as a

sell

. Among the areas we feel are negative, one of the most important has been an overall disappointing return on equity.

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 Semiconductors & Semiconductor Equipment industry and the overall market, APPLIED MICRO CIRCUITS CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • After a year of stock price fluctuations, the net result is that AMCC's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The gross profit margin for APPLIED MICRO CIRCUITS CORP is rather high; currently it is at 59.93%. Regardless of AMCC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, AMCC's net profit margin of -20.28% significantly underperformed when compared to the industry average.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 9.6%. Since the same quarter one year prior, revenues slightly dropped by 2.9%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • APPLIED MICRO CIRCUITS CORP has improved earnings per share by 33.3% in the most recent quarter compared to the same quarter a year ago. 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, APPLIED MICRO CIRCUITS CORP reported poor results of -$0.66 versus -$0.10 in the prior year. This year, the market expects an improvement in earnings (-$0.11 versus -$0.66).

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