Sinclair Broadcast Group (SBGI) Is Today's Strong On High Volume Stock

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

  • SBGI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $23.4 million.
  • SBGI has traded 55,496 shares today.
  • SBGI is trading at 2.29 times the normal volume for the stock at this time of day.
  • SBGI is trading at a new high 3.03% 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.

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More details on SBGI:

Sinclair Broadcast Group, Inc., a diversified television broadcasting company, owns and operates, programs, or provides sales services to television stations in the United States. The stock currently has a dividend yield of 2.3%. SBGI has a PE ratio of 23.8. Currently there are 4 analysts that rate Sinclair Broadcast Group a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Sinclair Broadcast Group has been 1.2 million shares per day over the past 30 days. Sinclair Broadcast Group has a market cap of $2.0 billion and is part of the services sector and media industry. The stock has a beta of 2.02 and a short float of 25.7% with 19.28 days to cover. Shares are down 21.1% year-to-date as of the close of trading on Wednesday.

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 Sinclair Broadcast Group as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity and increase in net income. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 8.9%. Since the same quarter one year prior, revenues rose by 46.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 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 Media industry and the overall market, SINCLAIR BROADCAST GP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • SINCLAIR BROADCAST GP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, SINCLAIR BROADCAST GP reported lower earnings of $0.66 versus $1.77 in the prior year. This year, the market expects an improvement in earnings ($1.91 versus $0.66).
  • SBGI has underperformed the S&P 500 Index, declining 9.63% from its price level of one year ago. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • The debt-to-equity ratio is very high at 10.11 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, SBGI maintains a poor quick ratio of 0.92, which illustrates the inability to avoid short-term cash problems.

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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