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Tickers in this Article: LQDT, INFI, MNST, SYNA, PNRA, UNFI, SOHU
The market is having a good day so far. The Nasdaq has moved up 0.1%; the S&P 500 has risen 0.3%; and the Dow has increased 0.4%. The Nasdaq Composite Index is a capitalization-weighted index, with each company weighted in proportion to its market value.

The biggest movers traded on the NASDAQ so far are:
CompanyMarket CapPercentage Change
Liquidity Services (Nasdaq:LQDT)$1.71 billion-9.1%
Infinity Pharmaceuticals (Nasdaq:INFI)$520.3 million+8.8%
Monster (Nasdaq:MNST)$9.94 billion-6.3%
Synaptics (Nasdaq:SYNA)$937.3 million-6.1%
Panera (Nasdaq:PNRA)$4.73 billion+4.8%
United Natural Foods (Nasdaq:UNFI)$2.7 billion+4.3% (Nasdaq:SOHU)$1.56 billion+4.3%
Forex Broker Summary: Forex Capital Markets (FXCM)

Currently trading at $50.06 per share, Liquidity Services (Nasdaq:LQDT) has fallen 9.1%. The company is currently trading a volume of 1.5 million shares. In technical analysis, trading volume is used to determine the strength of a market indicator. A wide array of ratios can be used by investors to estimate the attractiveness of a potential or existing investment and get an idea of its valuation. The P/E ratio has been used for ages by analysts and still remains one of the most relevant pieces of stock valuation. Compared to the industry average of 23.44, LQDT's P/E ratio of 39.3 is quite high. This could mean that the market is expecting big things over the next few months or years. A high or low P/E ratio is not good or bad in and of itself, but a company trading with a high P/E ratio must continue to post strong financial performance or its stock price is likely to fall. SEE: Understanding The P/E Ratio

After rising 8.8%, Infinity Pharmaceuticals (Nasdaq:INFI) is currently trading at a share price of $20.75. The company's volume for the day so far is 288,202 shares, one times its current three-month average. High volume indicates a lot of investor interest while low volume indicates the opposite. Investment valuation ratios can be very useful in determining the value of a stock, but it is very important to keep in mind that while some financial ratios have general rules (or a broad application), in most instances it is a prudent practice to look at a company's historical performance and use peer company/industry comparisons to put any given company's ratio in perspective. The price/sales ratio measures a company's stock market value by its total revenues or alternatively, a company's price per share by its revenue per share. INFI has a high P/S ratio of 3.99. In young companies, a high P/S ratio is a sign of sales growth that is expected to turn into earnings and cash flow. A limitation of the P/S ratio is that the price component measures only stock market captialization, while sales are a function of the entire capital structure, potentially leading to wide differences between levered and unlevered companies.

Monster (Nasdaq:MNST) has decreased to $52.80 per share, a 6.3% fall. The company is trading at a volume of 2.7 million shares. Yesterday's volume was only 2.1 million shares. The trading volume for a stock indicates the level of investor interest. It is important for an investor to estimate the value of any potential or existing investment; valuation ratios make this easier. The debt ratio measures the leverage of a company, and a company's leverage is a good way to assess risk. MNST's debt ratio of 25.8% is on the low side. In other words, the company is less sensitive to changes in business or interest rates since less of its cash flow is dedicated to paying off loan expenses. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.

Synaptics (Nasdaq:SYNA) is trading at $26.67 per share, down 6.1%. At 556,142 shares, the company's volume so far today is 1.7 times the average daily volume. If a stock price makes a big move up or down, volume lets us know the significance of that move. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. The price/earnings to growth (PEG) ratio compares a company's P/E ratio to its earnings-per-share growth rate, which tells you whether or not you are getting a good value when purchasing a stock with a high price/earnings ratio (P/E ratio). PEG ratio for SYNA is consistent with the industry average at 1.38. While P/E ratios are important indicators of market value, a high P/E in and of itself is not bad because it may indicate a company whose earnings are growing very rapidly, so many investors look at the PEG ratio in order to get an idea of whether or not a particular P/E ratio is justified by underlying earnings growth.

Panera (Nasdaq:PNRA) has increased to a share price of $167.13, a 4.8% rise. This morning, the company is trading a volume of 830,387 shares. If a stock is trading on low volume, then there is not much interest in the stock. On the other hand, if a stock is trading on high volume, then there is a lot of interest in the stock. Investment valuation ratios can be very useful in estimating whether a stock price is too high, reasonable or a bargain investment opportunity. Perhaps one of the most widely-used stock analysis tools is the price-to-earnings ratio, or P/E. PNRA's P/E ratio of 30.8 is above the industry average of 20.73. Usually, if a stock has a high P/E ratio, it indicates that the market expects the company to grow earnings quickly in the future. From the investor's perspective, a stock with a lower ratio is relatively cheaper than a stock with a higher ratio. SEE: The P/E Ratio: A Good Market-Timing Indicator

United Natural Foods (Nasdaq:UNFI) is currently trading at $57.63 per share, a 4.3% increase. So far today, the company's volume is 206,417 shares, consistent with its average over the last three months. Volume is an important indicator because it indicates how significant a price shift is. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. The debt-equity (D/E) ratio is a leverage ratio. UNFI has a debt-equity ratio of 22%, which is on the low side. Companies with low D/E ratios are more attractive to investors because they are better able to protect their business interests in times of decline. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.

Increasing 4.3%, (Nasdaq:SOHU) is trading at $42.75 per share. So far today, 302,491 shares of the company's stock have changed hands. Price change alone is not enough to know how a stock is doing. Volume is an important secondary indicator used to confirm trends suggested by price movement. Investment valuation ratios can be very useful in determining the value of a stock, but it is very important to keep in mind that while some financial ratios have general rules (or a broad application), in most instances it is a prudent practice to look at a company's historical performance and use peer company/industry comparisons to put any given company's ratio in perspective. The price/book value ratio is one of the more common methods of determining whether a stock is fairly valued. SOHU has a P/B ratio of 1.59 which shows that its share price is higher than its book value. This implies that investors expect management to create more value from a given set of assets and/or that the market value of the firm's assets is significantly higher than their accounting value. Users need to be careful when applying this ratio though, as it is more useful for industrial companies that have a lot of tangible assets than it is for technology or consumer product companies that may not have much in the way of hard assets. SEE: Investment Valuation Ratios: Price/Book Value Ratio

The Bottom Line The nature of the market is such that stocks will have good days and bad days. Paying close attention to the previous ratios will help you identify key times to adjust your strategy. However, these fundamental metrics must be analyzed with historic data, industry information in addition to firm specific financial statements.

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