Eldorado Gold (EGO) Weak On High Volume Today

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

  • EGO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $22.9 million.
  • EGO has traded 954,622 shares today.
  • EGO is trading at 2.62 times the normal volume for the stock at this time of day.
  • EGO is trading at a new low 4.01% 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 EGO:

Eldorado Gold Corporation, together with its subsidiaries, engages in the exploration, development, and mining of gold properties in Turkey, China, Greece, Brazil, and Romania. It also explores for iron, silver, lead, and zinc. The company was formerly known as Eldorado Corporation Ltd. The stock currently has a dividend yield of 0.4%. Currently there are 5 analysts that rate Eldorado Gold a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for Eldorado Gold has been 7.4 million shares per day over the past 30 days. Eldorado has a market cap of $3.1 billion and is part of the basic materials sector and metals & mining industry. Shares are up 37.7% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Eldorado Gold as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:
  • 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 Metals & Mining industry and the overall market, ELDORADO GOLD CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to $2.44 million or 96.74% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • ELDORADO GOLD CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, ELDORADO GOLD CORP swung to a loss, reporting -$2.15 versus $0.14 in the prior year.
  • Despite the weak revenue results, EGO has outperformed against the industry average of 47.9%. Since the same quarter one year prior, revenues fell by 31.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • 42.55% is the gross profit margin for ELDORADO GOLD CORP which we consider to be strong. Regardless of EGO's high profit margin, it has managed to decrease from the same period last year.

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