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

  • DSW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $56.6 million.
  • DSW has traded 355,182 shares today.
  • DSW is trading at 3.41 times the normal volume for the stock at this time of day.
  • DSW is trading at a new high 3.02% 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 DSW:

DSW Inc. operates as a branded footwear and accessories retailer in the United States. The company operates in two segments, DSW and Affiliated Business Group. The stock currently has a dividend yield of 2.2%. DSW has a PE ratio of 21.0. Currently there are 5 analysts that rate DSW a buy, 1 analyst rates it a sell, and 4 rate it a hold.

The average volume for DSW has been 1.3 million shares per day over the past 30 days. DSW has a market cap of $2.8 billion and is part of the services sector and retail industry. The stock has a beta of 0.44 and a short float of 3.2% with 1.29 days to cover. Shares are down 18.4% 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 DSW as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Despite its growing revenue, the company underperformed as compared with the industry average of 8.9%. Since the same quarter one year prior, revenues slightly increased by 7.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • DSW 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. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.81 is somewhat weak and could be cause for future problems.
  • DSW INC's earnings per share declined by 8.3% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, DSW INC increased its bottom line by earning $1.64 versus $1.60 in the prior year. For the next year, the market is expecting a contraction of 0.6% in earnings ($1.63 versus $1.64).
  • 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. Compared to other companies in the Specialty Retail industry and the overall market on the basis of return on equity, DSW INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

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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