JinkoSolar (JKS) Flagged As Strong 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.

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

  • JKS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $20.3 million.
  • JKS has traded 276,876 shares today.
  • JKS is trading at 5.00 times the normal volume for the stock at this time of day.
  • JKS is trading at a new high 4.03% 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 JKS:

JinkoSolar Holding Co., Ltd., together with its subsidiaries, engages in the design, development, production, and marketing of photovoltaic products in the People's Republic of China and internationally. The company operates through two segments, Manufacturing and Solar Power Projects. JKS has a PE ratio of 8.3. Currently there are 5 analysts that rate JinkoSolar a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for JinkoSolar has been 1.0 million shares per day over the past 30 days. JinkoSolar has a market cap of $870.7 million and is part of the technology sector and electronics industry. Shares are up 46% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates JinkoSolar as a sell. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk and poor profit margins.

Highlights from the ratings report include:
  • The debt-to-equity ratio is very high at 2.38 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, JKS maintains a poor quick ratio of 0.77, which illustrates the inability to avoid short-term cash problems.
  • The gross profit margin for JINKOSOLAR HOLDING CO is rather low; currently it is at 22.84%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 8.29% significantly trails the industry average.
  • In its most recent trading session, JKS has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. 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.
  • JINKOSOLAR HOLDING CO's earnings per share declined by 25.0% 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, JINKOSOLAR HOLDING CO increased its bottom line by earning $2.39 versus $1.09 in the prior year. This year, the market expects an improvement in earnings ($3.48 versus $2.39).
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market on the basis of return on equity, JINKOSOLAR HOLDING CO has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

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