Trade-Ideas LLC identified

Copa Holdings

(

CPA

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

  • CPA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $35.2 million.
  • CPA has traded 104,543 shares today.
  • CPA is trading at 3.41 times the normal volume for the stock at this time of day.
  • CPA is trading at a new low 4.01% 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 CPA:

Copa Holdings, S.A. provides airline passenger and cargo services in Latin America. It offers services within Colombia; and international flights from various cities in Colombia to Panama, Venezuela, Ecuador, Mexico, Cuba, Guatemala, and Costa Rica. The stock currently has a dividend yield of 7.7%. CPA has a PE ratio of 6. Currently there are 3 analysts that rate Copa Holdings a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for Copa Holdings has been 733,300 shares per day over the past 30 days. Copa has a market cap of $1.4 billion and is part of the services sector and transportation industry. The stock has a beta of 1.89 and a short float of 15% with 5.53 days to cover. Shares are down 60.3% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Copa Holdings as a

hold

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

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.55, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.83 is somewhat weak and could be cause for future problems.
  • CPA, with its decline in revenue, underperformed when compared the industry average of 7.2%. Since the same quarter one year prior, revenues fell by 20.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • 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. In comparison to the other companies in the Airlines industry and the overall market, COPA HOLDINGS SA's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • The gross profit margin for COPA HOLDINGS SA is rather low; currently it is at 15.42%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 11.90% trails that of the industry average.

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