Global Eagle Entertainment (ENT) Weak On High Volume Today

Trade-Ideas LLC identified Global Eagle Entertainment ( ENT) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Global Eagle Entertainment as such a stock due to the following factors:

  • ENT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.6 million.
  • ENT has traded 65,560 shares today.
  • ENT is trading at 4.30 times the normal volume for the stock at this time of day.
  • ENT is trading at a new low 6.13% 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 ENT:

Global Eagle Entertainment Inc. provides content, connectivity, and digital media solutions for travel industry worldwide. The company operates through two segments, Connectivity and Content. The Connectivity segment offers Wi-Fi Internet connectivity through Ku-band satellite transmissions. Currently there are 3 analysts that rate Global Eagle Entertainment a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Global Eagle Entertainment has been 352,600 shares per day over the past 30 days. Global Eagle Entertainment has a market cap of $600.3 million and is part of the services sector and media industry. The stock has a beta of 1.41 and a short float of 9.6% with 11.93 days to cover. Shares are down 25.6% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Global Eagle Entertainment as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including poor profit margins and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 3.4%. Since the same quarter one year prior, revenues rose by 13.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • ENT's debt-to-equity ratio is very low at 0.20 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, ENT has a quick ratio of 2.05, which demonstrates the ability of the company to cover short-term liquidity needs.
  • ENT's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 41.26%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The gross profit margin for GLOBAL EAGLE ENTERTAINMENT is currently lower than what is desirable, coming in at 26.05%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -2.11% is significantly below that of the industry average.

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