Keurig Green Mountain (GMCR) Stock: Weak 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.

Trade-Ideas LLC identified Keurig Green Mountain ( GMCR) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Keurig Green Mountain as such a stock due to the following factors:

  • GMCR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $133.2 million.
  • GMCR has traded 198,429 shares today.
  • GMCR is trading at 3.13 times the normal volume for the stock at this time of day.
  • GMCR is trading at a new low 3.02% 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.

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

More details on GMCR:

Keurig Green Mountain, Inc. produces and sells specialty coffee, coffeemakers, teas, and other beverages in the United States and Canada. The stock currently has a dividend yield of 1%. GMCR has a PE ratio of 30.3. Currently there are 8 analysts that rate Keurig Green Mountain a buy, 2 analysts rate it a sell, and 5 rate it a hold.

The average volume for Keurig Green Mountain has been 1.7 million shares per day over the past 30 days. Keurig Green Mountain has a market cap of $18.8 billion and is part of the consumer goods sector and food & beverage industry. The stock has a beta of 2.27 and a short float of 6.1% with 5.95 days to cover. Shares are down 12.2% year-to-date as of the close of trading on Friday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Keurig Green Mountain as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • GMCR's debt-to-equity ratio is very low at 0.08 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, GMCR has a quick ratio of 1.64, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 37.89% is the gross profit margin for KEURIG GREEN MOUNTAIN INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 9.70% is above that of the industry average.
  • KEURIG GREEN MOUNTAIN INC's earnings per share declined by 9.9% 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, KEURIG GREEN MOUNTAIN INC increased its bottom line by earning $3.74 versus $3.16 in the prior year. This year, the market expects an improvement in earnings ($4.11 versus $3.74).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 9.5%. Since the same quarter one year prior, revenues slightly dropped by 0.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

More from Markets

Facebook, Amazon, Microsoft and Ford - 5 Things You Must Know

Facebook, Amazon, Microsoft and Ford - 5 Things You Must Know

Facebook Set for Biggest Gain in Two Years After Q1 Earnings Top Forecasts

Facebook Set for Biggest Gain in Two Years After Q1 Earnings Top Forecasts

Global Stocks Mixed, U.S. Futures Soften as Earnings, Oil, Rates Cloud Sentiment

Global Stocks Mixed, U.S. Futures Soften as Earnings, Oil, Rates Cloud Sentiment

European Automakers Gain on Reports China Mulling Auto Tariff Reduction

European Automakers Gain on Reports China Mulling Auto Tariff Reduction

Deutsche Bank Plans 'Significant' Job Cuts as Q1 Profits Slump

Deutsche Bank Plans 'Significant' Job Cuts as Q1 Profits Slump