Cablevision Systems (CVC) 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.

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

  • CVC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $112.6 million.
  • CVC has traded 1.5 million shares today.
  • CVC is trading at 9.99 times the normal volume for the stock at this time of day.
  • CVC is trading at a new high 6.03% 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 CVC:

Cablevision Systems Corporation, together with its subsidiaries, owns and operates cable systems in the United States. The company operates through three segments: Cable, Lightpath, and Other. The stock currently has a dividend yield of 2.9%. CVC has a PE ratio of 21. Currently there are 3 analysts that rate Cablevision Systems a buy, 4 analysts rate it a sell, and 8 rate it a hold.

The average volume for Cablevision Systems has been 3.7 million shares per day over the past 30 days. Cablevision Systems has a market cap of $4.6 billion and is part of the services sector and media industry. The stock has a beta of 1.35 and a short float of 43.6% with 10.82 days to cover. Shares are up 2.1% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Cablevision Systems as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and feeble growth in the company's earnings per share.

Highlights from the ratings report include:
  • Despite its growing revenue, the company underperformed as compared with the industry average of 4.2%. Since the same quarter one year prior, revenues slightly increased by 2.5%. 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.
  • 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. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • The gross profit margin for CABLEVISION SYS CORP is rather high; currently it is at 50.71%. Regardless of CVC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 2.76% trails the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Media industry. The net income has significantly decreased by 50.3% when compared to the same quarter one year ago, falling from $89.76 million to $44.63 million.
  • Net operating cash flow has decreased to $215.34 million or 24.04% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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