Strong On High Relative Volume: Net 1 UEPS Technologies (UEPS)

Trade-Ideas LLC identified Net 1 UEPS Technologies ( UEPS) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Net 1 UEPS Technologies as such a stock due to the following factors:

  • UEPS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $7.8 million.
  • UEPS has traded 81,191 shares today.
  • UEPS is trading at 3.87 times the normal volume for the stock at this time of day.
  • UEPS is trading at a new high 3.15% 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 UEPS:

Net 1 UEPS Technologies, Inc. provides payment solutions and transaction processing services for various industries in South Africa, South Korea, and internationally. UEPS has a PE ratio of 6. Currently there is 1 analyst that rates Net 1 UEPS Technologies a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Net 1 UEPS Technologies has been 452,400 shares per day over the past 30 days. Net 1 UEPS has a market cap of $554.2 million and is part of the services sector and diversified services industry. The stock has a beta of 0.46 and a short float of 3.2% with 1.36 days to cover. Shares are down 13.2% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Net 1 UEPS Technologies as a hold. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and disappointing return on equity.

Highlights from the ratings report include:
  • UEPS's debt-to-equity ratio is very low at 0.13 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.76 is somewhat weak and could be cause for future problems.
  • 47.65% is the gross profit margin for NET 1 UEPS TECHNOLOGIES INC which we consider to be strong. Regardless of UEPS's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 11.08% trails the industry average.
  • Net operating cash flow has significantly decreased to $4.05 million or 72.30% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the IT Services industry average. The net income has significantly decreased by 25.5% when compared to the same quarter one year ago, falling from $22.37 million to $16.66 million.

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