Strong On High Volume: Dominion Diamond (DDC)

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 Dominion Diamond ( DDC) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Dominion Diamond as such a stock due to the following factors:

  • DDC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.0 million.
  • DDC has traded 86,461 shares today.
  • DDC is trading at 9.96 times the normal volume for the stock at this time of day.
  • DDC is trading at a new high 5.01% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into 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. 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.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in DDC with the Ticky from Trade-Ideas. See the FREE profile for DDC NOW at Trade-Ideas

More details on DDC:

Dominion Diamond Corporation focuses on the mining and marketing of rough diamonds worldwide. The company operates through Diavik Diamond Mine, Ekati Diamond Mine, and Corporate segments. DDC has a PE ratio of 41.3. Currently there are 2 analysts that rate Dominion Diamond a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Dominion Diamond has been 215,200 shares per day over the past 30 days. Dominion has a market cap of $1.2 billion and is part of the basic materials sector and metals & mining industry. Shares are down 4.2% year-to-date as of the close of trading on Monday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Dominion Diamond as a hold. 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 and increase in net income. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall.

Highlights from the ratings report include:
  • DDC's revenue growth has slightly outpaced the industry average of 0.6%. Since the same quarter one year prior, revenues slightly increased by 5.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • DDC'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. To add to this, DDC has a quick ratio of 1.61, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 42.86% is the gross profit margin for DOMINION DIAMOND CORP which we consider to be strong. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 9.58% trails the industry average.
  • 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 Metals & Mining industry and the overall market on the basis of return on equity, DOMINION DIAMOND CORP underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • Net operating cash flow has declined marginally to $101.39 million or 3.56% when compared to the same quarter last year. Despite a decrease in cash flow of 3.56%, DOMINION DIAMOND CORP is in line with the industry average cash flow growth rate of -9.81%.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

null

More from Markets

Week Ahead: Trade Fears and Stress Tests Signal More Volatility To Come

Week Ahead: Trade Fears and Stress Tests Signal More Volatility To Come

Trump Takes Aim at Auto Imports; Markets End Mixed -- ICYMI

Trump Takes Aim at Auto Imports; Markets End Mixed -- ICYMI

Video: What Oprah's Content Partnership With Apple Means for the Rest of Tech

Video: What Oprah's Content Partnership With Apple Means for the Rest of Tech

REPLAY: Jim Cramer on the Markets, Oil, Starbucks, Tesla, Okta and Red Hat

REPLAY: Jim Cramer on the Markets, Oil, Starbucks, Tesla, Okta and Red Hat

Flashback Friday: The Market Movers

Flashback Friday: The Market Movers