China Unicom (Hong Kong (CHU) Stock: Weak On High Volume Today

Trade-Ideas LLC identified China Unicom (Hong Kong ( CHU) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified China Unicom (Hong Kong as such a stock due to the following factors:

  • CHU has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $3.7 million.
  • CHU has traded 1.6 million shares today.
  • CHU is trading at 21.64 times the normal volume for the stock at this time of day.
  • CHU 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 CHU:

China Unicom (Hong Kong) Limited, an investment holding company, provides telecommunications services in the People's Republic of China. The stock currently has a dividend yield of 2.2%. CHU has a PE ratio of 16.

The average volume for China Unicom (Hong Kong has been 351,200 shares per day over the past 30 days. China Unicom (Hong Kong has a market cap of $26.0 billion and is part of the technology sector and telecommunications industry. Shares are down 10.3% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates China Unicom (Hong Kong as a sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself, feeble growth in its earnings per share, deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 40.96%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 85.71% compared to the year-earlier quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
  • CHINA UNICOM (HONG KONG) LTD has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, CHINA UNICOM (HONG KONG) LTD reported lower earnings of $0.66 versus $0.79 in the prior year. For the next year, the market is expecting a contraction of 32.6% in earnings ($0.45 versus $0.66).
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Diversified Telecommunication Services industry. The net income has significantly decreased by 85.4% when compared to the same quarter one year ago, falling from $510.41 million to $74.44 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Diversified Telecommunication Services industry and the overall market, CHINA UNICOM (HONG KONG) LTD's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • The gross profit margin for CHINA UNICOM (HONG KONG) LTD is currently lower than what is desirable, coming in at 28.39%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.68% significantly trails the industry average.

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