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

  • TDS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $14.9 million.
  • TDS has traded 54,460 shares today.
  • TDS is trading at 3.00 times the normal volume for the stock at this time of day.
  • TDS is trading at a new low 3.05% 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 TDS:

Telephone & Data Systems Inc., a telecommunications company, provides wireless, wireline, cable, and hosted and managed services in the United States. The stock currently has a dividend yield of 2.1%. TDS has a PE ratio of 14. Currently there are 2 analysts that rate Telephone and Data Systems a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Telephone and Data Systems has been 745,800 shares per day over the past 30 days. Telephone and Data Systems has a market cap of $3.1 billion and is part of the technology sector and telecommunications industry. The stock has a beta of 0.84 and a short float of 1.7% with 2.52 days to cover. Shares are up 10.3% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Telephone and Data Systems as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income and reasonable valuation levels. However, as a counter to these strengths, we find that the growth in the company's earnings per share has not been good.

Highlights from the ratings report include:
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Wireless Telecommunication Services industry. The net income increased by 95.0% when compared to the same quarter one year prior, rising from -$16.54 million to -$0.83 million.
  • Despite currently having a low debt-to-equity ratio of 0.59, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that TDS's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.97 is high and demonstrates strong liquidity.
  • TDS, with its decline in revenue, underperformed when compared the industry average of 14.5%. Since the same quarter one year prior, revenues slightly dropped by 1.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • TELEPHONE & DATA SYSTEMS INC reported significant earnings per share improvement 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. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, TELEPHONE & DATA SYSTEMS INC turned its bottom line around by earning $1.99 versus -$1.26 in the prior year. For the next year, the market is expecting a contraction of 88.4% in earnings ($0.23 versus $1.99).

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