Trade-Ideas LLC identified

Knowles Corporation

(

KN

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

  • KN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $29.8 million.
  • KN has traded 226,758 shares today.
  • KN is trading at 4.66 times the normal volume for the stock at this time of day.
  • KN is trading at a new low 3.04% 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 KN:

TheStreet Recommends

Knowles Corporation designs, manufactures, and sells products and components to the mobile communications, consumer electronics, medical technology, telecommunications infrastructure, military, aerospace, and industrial markets worldwide. Currently there is 1 analyst that rates Knowles Corporation a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Knowles Corporation has been 1.5 million shares per day over the past 30 days. Knowles has a market cap of $1.8 billion and is part of the technology sector and telecommunications industry. Shares are down 27.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Knowles Corporation as a

sell

. The company's weaknesses can be seen in multiple areas, such as its poor profit margins and unimpressive growth in net income.

Highlights from the ratings report include:

  • The gross profit margin for KNOWLES CORP is currently lower than what is desirable, coming in at 30.28%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -5.05% is significantly below that of the industry average.
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Electronic Equipment, Instruments & Components industry average. The net income has decreased by 2.0% when compared to the same quarter one year ago, dropping from -$14.61 million to -$14.90 million.
  • 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 Electronic Equipment, Instruments & Components industry and the overall market, KNOWLES CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • KNOWLES CORP reported flat earnings per share in the most recent quarter. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, KNOWLES CORP swung to a loss, reporting -$1.02 versus $0.38 in the prior year. This year, the market expects an improvement in earnings ($0.50 versus -$1.02).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 5.3%. Since the same quarter one year prior, revenues slightly dropped by 2.1%. Weakness in the company's revenue seems to not be hurting the bottom line, shown by stable earnings per share.

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