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

  • SYNA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $90.5 million
  • SYNA has traded 340,377 shares today
  • SYNA is trading at 4 times the normal volume for the stock at this time of day
  • SYNA is trading at a new high 3.000467998658300050607294906512834131717681884765625 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 SYNA:

Synaptics Incorporated develops, markets, and sells custom-designed human interface solutions for electronic devices and products primarily in China, South Korea, Taiwan, the United States, Japan, and other countries. SYNA has a PE ratio of 30. Currently there are six analysts that rate Synaptics a buy, no analysts rate it a sell, and two rate it a hold.

The average volume for Synaptics has been 737,000 shares per day over the past 30 days. Synaptics has a market cap of $3.31 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.42 and a short float of 11.9% with 3.97 days to cover. Shares are up 25.4% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Synaptics as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, compelling growth in net income, good cash flow from operations and impressive record of earnings per share growth. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:
  • SYNA's very impressive revenue growth greatly exceeded the industry average of 5.0%. Since the same quarter one year prior, revenues leaped by 133.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.33, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, SYNA has a quick ratio of 1.76, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 178.6% when compared to the same quarter one year prior, rising from -$40.06 million to $31.48 million.
  • Net operating cash flow has significantly increased by 2304.37% to $128.13 million when compared to the same quarter last year. In addition, SYNAPTICS INC has also vastly surpassed the industry average cash flow growth rate of 28.23%.
  • SYNAPTICS INC reported significant earnings per share improvement 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, SYNAPTICS INC reported lower earnings of $1.25 versus $2.87 in the prior year. This year, the market expects an improvement in earnings ($5.80 versus $1.25).

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