SemiLEDs (LEDS) Flagged As Strong On High Volume

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

  • LEDS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $13.1 million.
  • LEDS has traded 139,704 shares today.
  • LEDS is trading at 43.46 times the normal volume for the stock at this time of day.
  • LEDS is trading at a new high 10.17% 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.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in LEDS with the Ticky from Trade-Ideas. See the FREE profile for LEDS NOW at Trade-Ideas

More details on LEDS:

SemiLEDs Corporation develops, manufactures, and sells light emitting diode (LED) chips and LED components.

The average volume for SemiLEDs has been 319,600 shares per day over the past 30 days. SemiLEDs has a market cap of $20.3 million and is part of the technology sector and electronics industry. The stock has a beta of 0.66 and a short float of 2% with 0.02 days to cover. Shares are up 63.8% year-to-date as of the close of trading on Monday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates SemiLEDs as a sell. Among the areas we feel are negative, one of the most important has been poor profit margins.

Highlights from the ratings report include:
  • The gross profit margin for SEMILEDS CORP is rather low; currently it is at 16.80%. Regardless of LEDS's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, LEDS's net profit margin of -87.07% significantly underperformed when compared to the industry average.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, SEMILEDS CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The revenue fell significantly faster than the industry average of 5.7%. Since the same quarter one year prior, revenues fell by 36.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • LEDS's debt-to-equity ratio is very low at 0.14 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.17, which illustrates the ability to avoid short-term cash problems.
  • Investors have driven up the company's shares by 69.16% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the future course of this stock, we feel that the risks involved in investing in LEDS do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.