Canon (CAJ) Moving On Heavy Volume In The Pre-Market Hours

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Canon ( CAJ) as a pre-market mover with heavy volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Canon as such a stock due to the following factors:

  • CAJ has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $16.0 million.
  • CAJ traded 231,906 shares today in the pre-market hours as of 8:40 AM, representing 42.1% of its average daily volume.

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More details on CAJ:

Canon Inc. engages in the manufacture and sale of office multifunction devices (MFDs), plain paper copying machines, laser printers, inkjet printers, cameras, and lithography equipment worldwide. The stock currently has a dividend yield of 4.1%. CAJ has a PE ratio of 12.2. Currently there are 3 analysts that rate Canon a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Canon has been 369,400 shares per day over the past 30 days. Canon has a market cap of $34.5 billion and is part of the consumer goods sector and consumer durables industry. Shares are down 6.6% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Canon 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, expanding profit margins and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and disappointing return on equity.

Highlights from the ratings report include:
  • CAJ's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
  • The gross profit margin for CANON INC is rather high; currently it is at 56.55%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 6.43% is above that of the industry average.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 13.9%. Since the same quarter one year prior, revenues fell by 12.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • CANON INC's earnings per share declined by 10.2% in the most recent quarter compared to the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, CANON INC reported lower earnings of $2.21 versus $2.66 in the prior year. For the next year, the market is expecting a contraction of 6.8% in earnings ($2.06 versus $2.21).
  • 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. When compared to other companies in the Office Electronics industry and the overall market, CANON INC's return on equity is below that of both the industry average and the S&P 500.

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