Trade-Ideas LLC identified Pier 1 Imports ( PIR) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Pier 1 Imports as such a stock due to the following factors:

  • PIR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.0 million.
  • PIR has traded 397,947 shares today.
  • PIR is trading at 2.99 times the normal volume for the stock at this time of day.
  • PIR is trading at a new low 3.16% 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 PIR:

Pier 1 Imports, Inc. engages in the retail sale of decorative accessories, furniture, candles, housewares, gifts, and seasonal products. The stock currently has a dividend yield of 5.5%. PIR has a PE ratio of 16. Currently there are 3 analysts that rate Pier 1 Imports a buy, 3 analysts rate it a sell, and 7 rate it a hold.

The average volume for Pier 1 Imports has been 2.7 million shares per day over the past 30 days. Pier 1 Imports has a market cap of $420.7 million and is part of the services sector and specialty retail industry. The stock has a beta of 1.78 and a short float of 33.5% with 11.91 days to cover. Shares are up 0.6% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Pier 1 Imports as a hold. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:
  • Net operating cash flow has increased to $33.52 million or 18.29% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -1.49%.
  • The debt-to-equity ratio is somewhat low, currently at 0.75, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Despite the fact that PIR's debt-to-equity ratio is low, the quick ratio, which is currently 0.53, displays a potential problem in covering short-term cash needs.
  • 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 Specialty Retail industry. The net income has significantly decreased by 187.6% when compared to the same quarter one year ago, falling from $6.87 million to -$6.02 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. In comparison to the other companies in the Specialty Retail industry and the overall market, PIER 1 IMPORTS INC/DE's return on equity is significantly below that of the industry average and is below that of the S&P 500.

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