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Trade-Ideas LLC identified

Armstrong World Industries

(

AWI

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

  • AWI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $28.0 million.
  • AWI has traded 99,163 shares today.
  • AWI is trading at 9.50 times the normal volume for the stock at this time of day.
  • AWI is trading at a new low 6.04% 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 AWI:

TheStreet Recommends

Armstrong World Industries, Inc. designs, manufactures, and sells flooring products and ceiling systems for use primarily in the construction and renovation of residential, commercial, and institutional buildings worldwide. AWI has a PE ratio of 3. Currently there are 4 analysts that rate Armstrong World Industries a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for Armstrong World Industries has been 643,200 shares per day over the past 30 days. Armstrong World has a market cap of $2.2 billion and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 1.40 and a short float of 7.5% with 4.02 days to cover. Shares are down 11.3% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Armstrong World Industries 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 increase in net income. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:

  • ARMSTRONG WORLD INDUSTRIES's earnings per share declined by 35.7% 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, ARMSTRONG WORLD INDUSTRIES increased its bottom line by earning $1.84 versus $1.70 in the prior year. This year, the market expects an improvement in earnings ($2.32 versus $1.84).
  • AWI, with its decline in revenue, slightly underperformed the industry average of 5.8%. Since the same quarter one year prior, revenues slightly dropped by 3.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The share price of ARMSTRONG WORLD INDUSTRIES has not done very well: it is down 23.42% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
  • 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 Building Products industry and the overall market, ARMSTRONG WORLD INDUSTRIES'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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