Roadrunner Transportation Systems (RRTS) Weak On High Volume Today

Trade-Ideas LLC identified Roadrunner Transportation Systems ( RRTS) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Roadrunner Transportation Systems as such a stock due to the following factors:

  • RRTS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.9 million.
  • RRTS has traded 63,665 shares today.
  • RRTS is trading at 2.85 times the normal volume for the stock at this time of day.
  • RRTS is trading at a new low 5.17% 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 RRTS:

Roadrunner Transportation Systems, Inc. provides asset-light transportation and logistics services. The company operates through three segments: Truckload Logistics (TL), Less-than-Truckload (LTL), and Transportation Management Solutions (TMS). RRTS has a PE ratio of 8. Currently there are 5 analysts that rate Roadrunner Transportation Systems a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Roadrunner Transportation Systems has been 417,700 shares per day over the past 30 days. Roadrunner Transportation Systems has a market cap of $380.7 million and is part of the services sector and transportation industry. The stock has a beta of 0.66 and a short float of 2.9% with 2.57 days to cover. Shares are down 57.8% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Roadrunner Transportation Systems as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:
  • The debt-to-equity ratio is somewhat low, currently at 0.76, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. To add to this, RRTS has a quick ratio of 1.76, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 9.7%. Since the same quarter one year prior, revenues slightly dropped by 0.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Road & Rail industry and the overall market, ROADRUNNER TRANS SVCS HLDGS's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • 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 Road & Rail industry. The net income has significantly decreased by 59.8% when compared to the same quarter one year ago, falling from $14.41 million to $5.79 million.

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