Trade-Ideas LLC identified

Patterson Companies

(

PDCO

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

  • PDCO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $63.4 million.
  • PDCO has traded 363,743 shares today.
  • PDCO is trading at 11.10 times the normal volume for the stock at this time of day.
  • PDCO is trading at a new high 4.02% 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 PDCO:

Patterson Companies, Inc. distributes dental, veterinary, and rehabilitation supplies. The stock currently has a dividend yield of 2.1%. PDCO has a PE ratio of 21. Currently there are 2 analysts that rate Patterson Companies a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Patterson Companies has been 853,700 shares per day over the past 30 days. Patterson Companies has a market cap of $4.6 billion and is part of the services sector and wholesale industry. The stock has a beta of 0.95 and a short float of 7.2% with 5.04 days to cover. Shares are up 0.7% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Patterson Companies as a

buy

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, growth in earnings per share, notable return on equity, largely solid financial position with reasonable debt levels by most measures and increase in net income. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 8.5%. Since the same quarter one year prior, revenues rose by 46.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • PATTERSON COMPANIES INC has improved earnings per share by 27.6% 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, PATTERSON COMPANIES INC reported lower earnings of $1.92 versus $1.97 in the prior year. This year, the market expects an improvement in earnings ($2.45 versus $1.92).
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Health Care Providers & Services industry and the overall market on the basis of return on equity, PATTERSON COMPANIES INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • PDCO's debt-to-equity ratio of 0.91 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.87 is weak.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Health Care Providers & Services industry average, but is greater than that of the S&P 500. The net income increased by 3.2% when compared to the same quarter one year prior, going from $54.68 million to $56.44 million.

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