Titan International (TWI) Is Weak 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 Titan International ( TWI) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Titan International as such a stock due to the following factors:

  • TWI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.8 million
  • TWI has traded 51,948 shares today
  • TWI is trading at 2.06 times the normal volume for the stock at this time of day
  • TWI is trading at a new low 3.0520659076253000563383466214872896671295166015625 below yesterday's close

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of 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 (or avoid losses by trimming weak positions). 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 TWI:

Titan International, Inc., together with its subsidiaries, manufactures and sells wheels, tires, and undercarriage systems and components for off-highway vehicles in the United States and internationally. The stock currently has a dividend yield of 0.2%. Currently there are two analysts that rate Titan International a buy, no analysts rate it a sell, and three rate it a hold.

The average volume for Titan International has been 539,900 shares per day over the past 30 days. Titan International has a market cap of $570.1 million and is part of the industrial goods sector and industrial industry. The stock has a beta of 1.84 and a short float of 17.5% with 14.03 days to cover. Shares are up 4.8% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Titan International as a hold. Among the primary strengths of the company is its solid financial position based on a variety of debt and liquidity measures that we have evaluated. At the same time, however, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:
  • TWI, with its decline in revenue, underperformed when compared the industry average of 11.4%. Since the same quarter one year prior, revenues fell by 25.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • Even though the current debt-to-equity ratio is 1.01, it is still below the industry average, suggesting that this level of debt is acceptable within the Machinery industry. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.36 is sturdy.
  • TITAN INTERNATIONAL INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from 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, TITAN INTERNATIONAL INC swung to a loss, reporting -$1.50 versus $0.60 in the prior year. This year, the market expects an improvement in earnings (-$0.27 versus -$1.50).
  • 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 Machinery industry. The net income has significantly decreased by 89.3% when compared to the same quarter one year ago, falling from $2.16 million to $0.23 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Machinery industry and the overall market, TITAN INTERNATIONAL INC's return on equity significantly trails that of both the industry average and the S&P 500.

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