Trade-Ideas LLC identified

SUPERVALU

(

SVU

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

  • SVU has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $10.0 million.
  • SVU has traded 698,243 shares today.
  • SVU is trading at 5.78 times the normal volume for the stock at this time of day.
  • SVU is trading at a new low 9.09% 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 SVU:

SUPERVALU INC., together with its subsidiaries, operates as a grocery wholesaler and retailer in the United States. The company operates through three segments: Wholesale, Save-A-Lot, and Retail. SVU has a PE ratio of 8. Currently there is 1 analyst that rates SUPERVALU a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for SUPERVALU has been 2.6 million shares per day over the past 30 days. SUPERVALU has a market cap of $1.4 billion and is part of the services sector and retail industry. The stock has a beta of 1.64 and a short float of 5.5% with 5.84 days to cover. Shares are down 22.1% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates SUPERVALU as a

hold

. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth and increase in net income. However, as a counter to these strengths, we also find weaknesses including poor profit margins, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • SUPERVALU INC has improved earnings per share by 38.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, SUPERVALU INC increased its bottom line by earning $0.65 versus $0.46 in the prior year. This year, the market expects an improvement in earnings ($0.72 versus $0.65).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Food & Staples Retailing industry. The net income increased by 33.3% when compared to the same quarter one year prior, rising from $39.00 million to $52.00 million.
  • SVU, with its decline in revenue, slightly underperformed the industry average of 1.5%. Since the same quarter one year prior, revenues fell by 10.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • The gross profit margin for SUPERVALU INC is currently extremely low, coming in at 14.95%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.31% trails that of the industry average.
  • Net operating cash flow has decreased to $172.00 million or 43.04% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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