Heavy Trading On King Digital Entertainment (KING) Before Market Open

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

  • KING has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $25.9 million.
  • KING traded 283,477 shares today in the pre-market hours as of 7:26 AM, representing 19.6% of its average daily volume.

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More details on KING:

King Digital Entertainment plc, an interactive entertainment company, produces and distributes digital games on multiple platforms in the United States, the United Kingdom, Germany, and internationally. KING has a PE ratio of 9. Currently there are 5 analysts that rate King Digital Entertainment a buy, no analysts rate it a sell, and 8 rate it a hold.

The average volume for King Digital Entertainment has been 1.4 million shares per day over the past 30 days. King Digital Entertainment has a market cap of $4.7 billion and is part of the services sector and leisure industry. The stock has a beta of 7.12 and a short float of 37.6% with 13.98 days to cover. Shares are down 2.6% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates King Digital Entertainment as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income and weak operating cash flow.

Highlights from the ratings report include:
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Software industry average. The net income has significantly decreased by 27.9% when compared to the same quarter one year ago, falling from $165.37 million to $119.30 million.
  • Net operating cash flow has declined marginally to $151.37 million or 6.40% when compared to the same quarter last year. Despite a decrease in cash flow of 6.40%, KING DIGITAL ENTERTAINMENT is in line with the industry average cash flow growth rate of -11.94%.
  • KING DIGITAL ENTERTAINMENT's earnings per share declined by 26.9% in the most recent quarter compared to the same quarter a year ago. This year, the market expects an improvement in earnings ($1.84 versus $1.81).
  • The gross profit margin for KING DIGITAL ENTERTAINMENT is rather high; currently it is at 68.24%. Regardless of KING's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, KING's net profit margin of 24.03% compares favorably to the industry average.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 18.8%. Since the same quarter one year prior, revenues fell by 16.4%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

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