Trina Solar (TSL) Weak On High Volume

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

  • TSL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $37.8 million.
  • TSL has traded 1.7 million shares today.
  • TSL is trading at 8.28 times the normal volume for the stock at this time of day.
  • TSL is trading at a new low 7.04% 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 TSL:

Trina Solar Limited operates as an integrated solar-power products manufacturer and solar system developer in the People's Republic of China, Europe, the United States, and other Asia Pacific regions. TSL has a PE ratio of 40.4. Currently there are 4 analysts that rate Trina Solar a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Trina Solar has been 5.2 million shares per day over the past 30 days. Trina Solar has a market cap of $867.3 million and is part of the technology sector and electronics industry. Shares are down 20% year-to-date as of the close of trading on Friday.

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 Trina Solar as a hold. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income and robust revenue growth. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, poor profit margins and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • TRINA SOLAR LTD reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, TRINA SOLAR LTD continued to lose money by earning -$1.02 versus -$3.76 in the prior year. This year, the market expects an improvement in earnings ($0.90 versus -$1.02).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 131.9% when compared to the same quarter one year prior, rising from -$33.65 million to $10.73 million.
  • The gross profit margin for TRINA SOLAR LTD is rather low; currently it is at 15.45%. Regardless of TSL's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, TSL's net profit margin of 2.06% is significantly lower than the industry average.
  • The debt-to-equity ratio of 1.04 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, TSL has a quick ratio of 0.65, this demonstrates the lack of ability of the company to cover short-term liquidity needs.

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

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