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

  • CBT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $20.2 million.
  • CBT has traded 70,890 shares today.
  • CBT is trading at 4.52 times the normal volume for the stock at this time of day.
  • CBT is trading at a new high 4.16% 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 CBT:

Cabot Corporation operates as a specialty chemicals and performance materials company. The stock currently has a dividend yield of 2.2%. Currently there are 5 analysts that rate Cabot a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Cabot has been 433,500 shares per day over the past 30 days. Cabot has a market cap of $2.5 billion and is part of the basic materials sector and chemicals industry. The stock has a beta of 1.26 and a short float of 1.2% with 1.45 days to cover. Shares are down 3.5% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

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

Highlights from the ratings report include:
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Chemicals industry. The net income increased by 29.0% when compared to the same quarter one year prior, rising from $31.00 million to $40.00 million.
  • The debt-to-equity ratio is somewhat low, currently at 0.79, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.26, which illustrates the ability to avoid short-term cash problems.
  • CABOT CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CABOT CORP swung to a loss, reporting -$5.33 versus $2.99 in the prior year. This year, the market expects an improvement in earnings ($3.30 versus -$5.33).
  • The gross profit margin for CABOT CORP is currently lower than what is desirable, coming in at 28.02%. Regardless of CBT's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 5.96% trails the industry average.
  • 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 Chemicals industry and the overall market, CABOT CORP's return on equity significantly trails that of both the industry average and the S&P 500.

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