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

  • USG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $46.3 million.
  • USG has traded 174,453 shares today.
  • USG is trading at 3.50 times the normal volume for the stock at this time of day.
  • USG is trading at a new low 4.03% 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 USG:

USG Corporation manufactures and distributes building materials worldwide. Its Gypsum segment provides gypsum and related products to construct walls, ceilings, roofs, and floors of residential, commercial, and institutional buildings, as well as for various industrial applications. USG has a PE ratio of 4. Currently there are 3 analysts that rate USG a buy, no analysts rate it a sell, and 10 rate it a hold.

The average volume for USG has been 1.8 million shares per day over the past 30 days. USG has a market cap of $4.2 billion and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 1.10 and a short float of 10% with 5.30 days to cover. Shares are up 21.5% year-to-date as of the close of trading on Wednesday.

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TheStreet Quant Ratings rates USG as a hold. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth and notable return on equity. However, as a counter to these strengths, we find that the company's profit margins have been poor overall.

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 Building Products industry. The net income increased by 179.2% when compared to the same quarter one year prior, rising from $24.00 million to $67.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 10.0%. Since the same quarter one year prior, revenues slightly increased by 6.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Net operating cash flow has increased to -$30.00 million or 28.57% when compared to the same quarter last year. Despite an increase in cash flow, USG CORP's cash flow growth rate is still lower than the industry average growth rate of 49.45%.
  • Even though the current debt-to-equity ratio is 1.39, it is still below the industry average, suggesting that this level of debt is acceptable within the Building Products industry. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.12 is sturdy.
  • The gross profit margin for USG CORP is rather low; currently it is at 23.81%. Regardless of USG's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, USG's net profit margin of 6.90% compares favorably to the industry average.

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