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

  • CTXS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $202.0 million.
  • CTXS has traded 897,157 shares today.
  • CTXS is trading at 10.88 times the normal volume for the stock at this time of day.
  • CTXS is trading at a new high 3.01% 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 CTXS:

Citrix Systems, Inc. provides virtualization, mobility management, networking, and Software as a Service solutions worldwide. CTXS has a PE ratio of 49. Currently there are 10 analysts that rate Citrix Systems a buy, 3 analysts rate it a sell, and 11 rate it a hold.

The average volume for Citrix Systems has been 1.8 million shares per day over the past 30 days. Citrix Systems has a market cap of $10.6 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.66 and a short float of 2.9% with 1.64 days to cover. Shares are up 10.3% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

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

Highlights from the ratings report include:
  • CTXS's revenue growth has slightly outpaced the industry average of 5.0%. Since the same quarter one year prior, revenues slightly increased by 1.3%. 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.
  • Net operating cash flow has slightly increased to $291.87 million or 1.38% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -17.83%.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of 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.
  • CITRIX SYSTEMS INC's earnings per share declined by 40.0% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, CITRIX SYSTEMS INC reported lower earnings of $1.48 versus $1.81 in the prior year. This year, the market expects an improvement in earnings ($3.57 versus $1.48).
  • 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 Software industry. The net income has significantly decreased by 48.4% when compared to the same quarter one year ago, falling from $55.94 million to $28.89 million.

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