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

  • AGCO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $58.4 million
  • AGCO has traded 637,420 shares today
  • AGCO is trading at 2.28 times the normal volume for the stock at this time of day
  • AGCO is trading at a new high 3.006616935305399973543671876541338860988616943359375 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 AGCO:

AGCO Corporation manufactures and distributes agricultural equipment and related replacement parts worldwide. The stock currently has a dividend yield of 0.9%. AGCO has a PE ratio of 15. Currently there is one analyst that rates AGCO a buy, three analysts rate it a sell, and eight rate it a hold.

The average volume for AGCO has been 1.1 million shares per day over the past 30 days. AGCO has a market cap of $4.82 billion and is part of the industrial goods sector and industrial industry. The stock has a beta of 1.61 and a short float of 19.8% with 14.24 days to cover. Shares are up 20.3% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates AGCO as a buy. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.

Highlights from the ratings report include:
  • Net operating cash flow has increased to -$286.00 million or 44.03% when compared to the same quarter last year. In addition, AGCO CORP has also vastly surpassed the industry average cash flow growth rate of -21.61%.
  • 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. Despite the fact that AGCO's debt-to-equity ratio is low, the quick ratio, which is currently 0.66, displays a potential problem in covering short-term cash needs.
  • AGCO, with its decline in revenue, underperformed when compared the industry average of 11.3%. Since the same quarter one year prior, revenues fell by 27.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The share price of AGCO CORP has not done very well: it is down 5.80% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, although the push and pull of the overall market trend could certainly make a critical difference, we do not see any strong reason stemming from the company's fundamentals that would cause a continuation of last year's decline. In fact, the stock is now selling for less than others in its industry in relation to its current earnings.

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