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

  • DISCK has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $54.0 million.
  • DISCK has traded 126,901 shares today.
  • DISCK is trading at 2.43 times the normal volume for the stock at this time of day.
  • DISCK is trading at a new high 3.16% 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 DISCK:

Discovery Communications, Inc. operates as a media company. The company operates through U.S. Networks; International Networks; and Education and Other segments. DISCK has a PE ratio of 8. Currently there are no analysts that rate Discovery Communications a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Discovery Communications has been 1.8 million shares per day over the past 30 days. Discovery has a market cap of $7.2 billion and is part of the services sector and media industry. The stock has a beta of 1.67 and a short float of 1.1% with 1.40 days to cover. Shares are down 24.8% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Discovery Communications as a hold. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, growth in earnings per share and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow, a generally disappointing performance in the stock itself and disappointing return on equity.

Highlights from the ratings report include:
  • DISCOVERY COMMUNICATIONS INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, DISCOVERY COMMUNICATIONS INC increased its bottom line by earning $1.67 versus $1.34 in the prior year. This year, the market expects an improvement in earnings ($4.93 versus $1.67).
  • The gross profit margin for DISCOVERY COMMUNICATIONS INC is currently very high, coming in at 89.72%. Regardless of DISCK's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, DISCK's net profit margin of 17.91% compares favorably to the industry average.
  • DISCK has underperformed the S&P 500 Index, declining 17.98% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • Net operating cash flow has decreased to $258.00 million or 38.57% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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