Heavy Early Morning Activity On ABB (ABB)

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 ABB ( ABB) as a pre-market mover with heavy volume candidate. In addition to specific proprietary factors, Trade-Ideas identified ABB as such a stock due to the following factors:

  • ABB has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $33.5 million.
  • ABB traded 155,877 shares today in the pre-market hours as of 9:16 AM, representing 10.9% of its average daily volume.

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More details on ABB:

ABB Ltd provides power and automation technologies for utility and industrial customers worldwide. The stock currently has a dividend yield of 2.6%. ABB has a PE ratio of 18. Currently there is 1 analyst that rates ABB a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for ABB has been 1.6 million shares per day over the past 30 days. ABB has a market cap of $48.5 billion and is part of the industrial goods sector and industrial industry. Shares are up 4.2% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates ABB 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, reasonable valuation levels, good cash flow from operations, notable return on equity and growth in earnings per share. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • The current debt-to-equity ratio, 0.49, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.14, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has significantly increased by 217.77% to $53.00 million when compared to the same quarter last year. In addition, ABB LTD has also vastly surpassed the industry average cash flow growth rate of -11.34%.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Electrical Equipment industry and the overall market on the basis of return on equity, ABB LTD has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 11.7%. Since the same quarter one year prior, revenues slightly dropped by 9.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

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