Trade-Ideas LLC identified

Verint Systems

(

VRNT

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

  • VRNT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $45.2 million.
  • VRNT has traded 80,906 shares today.
  • VRNT is trading at 2.18 times the normal volume for the stock at this time of day.
  • VRNT is trading at a new low 3.05% 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 VRNT:

Verint Systems Inc. provides actionable intelligence solutions and value-added services worldwide. The company operates through three segments: Enterprise Intelligence Solutions, Communications and Cyber Intelligence Solutions, and Video and Situation Intelligence Solutions. VRNT has a PE ratio of 503. Currently there are 7 analysts that rate Verint Systems a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Verint Systems has been 491,000 shares per day over the past 30 days. Verint Systems has a market cap of $2.2 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.46 and a short float of 4.1% with 1.78 days to cover. Shares are down 17.4% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Verint Systems as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins and growth in earnings per share. 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:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Software industry. The net income increased by 281.9% when compared to the same quarter one year prior, rising from $4.58 million to $17.51 million.
  • The gross profit margin for VERINT SYSTEMS INC is currently very high, coming in at 70.40%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, VRNT's net profit margin of 6.23% significantly trails the industry average.
  • VRNT's debt-to-equity ratio of 0.70 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. Despite the fact that VRNT's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.53 is high and demonstrates strong liquidity.
  • 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. Compared to other companies in the Software industry and the overall market, VERINT SYSTEMS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to $69.33 million or 33.00% 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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