Sigma Designs (SIGM) Is Strong On High Volume Today

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

  • SIGM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.7 million.
  • SIGM has traded 231,058 shares today.
  • SIGM is trading at 10.18 times the normal volume for the stock at this time of day.
  • SIGM is trading at a new high 4.52% 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 SIGM with the Ticky from Trade-Ideas. See the FREE profile for SIGM NOW at Trade-Ideas

More details on SIGM:

Sigma Designs, Inc. provides integrated system-on-chip (SoC) solutions for digital television, home networking, set-top box, and home control markets. Currently there are 2 analysts that rate Sigma Designs a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Sigma Designs has been 285,400 shares per day over the past 30 days. Sigma Designs has a market cap of $193.9 million and is part of the technology sector and electronics industry. The stock has a beta of 0.67 and a short float of 1.4% with 1.34 days to cover. Shares are up 28% 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 Sigma Designs as a sell. The area that we feel has been the company's primary weakness has been its declining revenues.

Highlights from the ratings report include:
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, SIGMA DESIGNS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for SIGMA DESIGNS INC is rather high; currently it is at 59.42%. Regardless of SIGM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SIGM's net profit margin of -1.03% significantly underperformed when compared to the industry average.
  • SIGM, with its decline in revenue, underperformed when compared the industry average of 18.7%. Since the same quarter one year prior, revenues slightly dropped by 1.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • SIGM 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. To add to this, SIGM has a quick ratio of 2.27, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Looking at where the stock is today compared to one year ago, we find that it is higher, and it has outperformed the rise in the S&P 500 over the same period. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.

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

Lowe's Snags Ex-Home Depot Exec as CEO; ISPs Face Competitive Threat -- ICYMI

Lowe's Snags Ex-Home Depot Exec as CEO; ISPs Face Competitive Threat -- ICYMI

Dow Slips 178 Points; S&P 500 and Nasdaq Also Decline

Dow Slips 178 Points; S&P 500 and Nasdaq Also Decline

Legal Weed Sales in California Are Off to a Less Than Smokin' Start

Legal Weed Sales in California Are Off to a Less Than Smokin' Start

Owner of Moviepass Sees Stock Plummet

Owner of Moviepass Sees Stock Plummet

Ford, GM Gain as China Slashes Auto Import Tariffs

Ford, GM Gain as China Slashes Auto Import Tariffs