Triumph Group (TGI) Weak On High Volume

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

  • TGI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $17.1 million.
  • TGI has traded 169,961 shares today.
  • TGI is trading at 12.39 times the normal volume for the stock at this time of day.
  • TGI is trading at a new low 12.03% 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 TGI:

Triumph Group, Inc. designs, engineers, manufactures, repairs, overhauls, and distributes aero structures, aircraft components, accessories, subassemblies, and systems worldwide. The stock currently has a dividend yield of 0.4%. Currently there are 6 analysts that rate Triumph Group a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Triumph Group has been 694,700 shares per day over the past 30 days. Triumph Group has a market cap of $1.9 billion and is part of the industrial goods sector and aerospace/defense industry. The stock has a beta of 1.70 and a short float of 11.5% with 11.60 days to cover. Shares are down 1.1% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Triumph Group as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, generally high debt management risk and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • 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 Aerospace & Defense industry. The net income has significantly decreased by 1408.1% when compared to the same quarter one year ago, falling from $82.84 million to -$1,083.66 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Aerospace & Defense industry and the overall market, TRIUMPH GROUP INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for TRIUMPH GROUP INC is rather low; currently it is at 19.23%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -102.44% is significantly below that of the industry average.
  • Despite the current debt-to-equity ratio of 1.52, it is still below the industry average, suggesting that this level of debt is acceptable within the Aerospace & Defense industry. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.41 is very low and demonstrates very weak liquidity.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 37.19%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 1425.90% compared to the year-earlier 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.

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