Trade-Ideas LLC identified

Colfax

(

CFX

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

  • CFX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $37.2 million.
  • CFX has traded 225,996 shares today.
  • CFX is trading at 3.25 times the normal volume for the stock at this time of day.
  • CFX is trading at a new high 3.04% 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 CFX:

Colfax Corporation, an industrial manufacturing and engineering company, provides gas-and fluid-handling, and fabrication technology products and services to commercial and governmental customers worldwide. CFX has a PE ratio of 13. Currently there are 4 analysts that rate Colfax a buy, 1 analyst rates it a sell, and 8 rate it a hold.

The average volume for Colfax has been 1.4 million shares per day over the past 30 days. Colfax has a market cap of $2.7 billion and is part of the industrial goods sector and industrial industry. The stock has a beta of 1.21 and a short float of 7.4% with 5.64 days to cover. Shares are up 5.7% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Colfax as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.50, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.01, which illustrates the ability to avoid short-term cash problems.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 20.6%. Since the same quarter one year prior, revenues fell by 16.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Net operating cash flow has decreased to $85.27 million or 47.38% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • 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. In comparison to the other companies in the Machinery industry and the overall market, COLFAX CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.

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