Trade-Ideas LLC identified

Winnebago Industries

(

WGO

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

  • WGO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $8.6 million.
  • WGO has traded 80,944 shares today.
  • WGO is trading at 8.79 times the normal volume for the stock at this time of day.
  • WGO is trading at a new low 8.05% 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 WGO:

Winnebago Industries, Inc. manufactures and sells recreation vehicles primarily for use in leisure travel and outdoor recreation activities. The stock currently has a dividend yield of 1.8%. WGO has a PE ratio of 13. Currently there are 2 analysts that rate Winnebago Industries a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Winnebago Industries has been 295,700 shares per day over the past 30 days. Winnebago has a market cap of $534.6 million and is part of the consumer goods sector and automotive industry. The stock has a beta of 2.20 and a short float of 21.6% with 11.12 days to cover. Shares are down 7.5% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Winnebago Industries as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, increase in net income, good cash flow from operations and growth in earnings per share. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 7.3%. Since the same quarter one year prior, revenues slightly increased by 7.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • WGO has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, WGO has a quick ratio of 1.54, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Automobiles industry average. The net income increased by 1.0% when compared to the same quarter one year prior, going from $11.39 million to $11.50 million.
  • Net operating cash flow has increased to $52.61 million or 32.45% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 8.44%.
  • WINNEBAGO INDUSTRIES's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, WINNEBAGO INDUSTRIES increased its bottom line by earning $1.65 versus $1.13 in the prior year. For the next year, the market is expecting a contraction of 3.6% in earnings ($1.59 versus $1.65).

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