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

  • PACW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $59.1 million.
  • PACW has traded 170,147 shares today.
  • PACW is trading at 5.30 times the normal volume for the stock at this time of day.
  • PACW is trading at a new high 3.03% 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 PACW:

PacWest Bancorp operates as the holding company for Pacific Western Bank that provides commercial banking products and services to individuals, professionals, and small to mid-sized businesses in the United States. It accepts demand, money market, and time deposits. The stock currently has a dividend yield of 5.9%. PACW has a PE ratio of 12. Currently there are 6 analysts that rate PacWest Bancorp a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for PacWest Bancorp has been 884,100 shares per day over the past 30 days. PacWest has a market cap of $4.2 billion and is part of the financial sector and banking industry. The stock has a beta of 1.35 and a short float of 4.5% with 2.80 days to cover. Shares are down 18.8% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates PacWest Bancorp as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, good cash flow from operations and expanding profit margins. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • PACW's revenue growth has slightly outpaced the industry average of 1.4%. Since the same quarter one year prior, revenues slightly increased by 2.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • PACWEST BANCORP has improved earnings per share by 13.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, PACWEST BANCORP increased its bottom line by earning $1.97 versus $1.08 in the prior year. This year, the market expects an improvement in earnings ($2.88 versus $1.97).
  • The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Commercial Banks industry average. The net income increased by 11.8% when compared to the same quarter one year prior, going from $62.27 million to $69.62 million.
  • Net operating cash flow has increased to $124.28 million or 28.59% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -12.38%.
  • The gross profit margin for PACWEST BANCORP is currently very high, coming in at 89.30%. Regardless of PACW's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, PACW's net profit margin of 31.15% compares favorably to the industry average.

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