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Tickers in this Article: RMBS, VECO, MMYT, CYMI, CTXS, MLNX, NTK
This morning has been rocky for the market. The Nasdaq has decreased 0.7%; the S&P 500 has declined 0.2%; and the Dow is down 0.2%. The Nasdaq Composite Index represents all the stocks that trade on the Nasdaq stock market.

The biggest movers traded on the NASDAQ so far are:
CompanyMarket CapPercentage Change
Rambus (Nasdaq:RMBS)$545.7 million+19.5%
Veeco Instruments (Nasdaq:VECO)$1.37 billion-9.2%
MakeMyTrip (Nasdaq:MMYT)$619.1 million+7.9%
Cymer (Nasdaq:CYMI)$1.71 billion-5.6%
Citrix (Nasdaq:CTXS)$15.18 billion-5.2%
Mellanox (Nasdaq:MLNX)$4.41 billion-3.8%
Nortek (Nasdaq:NTK)$804.2 million+2.2%
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After a big jump of 19.5%, Rambus (Nasdaq:RMBS) is trading at $5.89 per share. The company is currently trading a volume of 3.4 million shares. In technical analysis, trading volume is used to determine the strength of a market indicator. While investment valuation ratios are useful tools in estimating the attractiveness of an investment, remember that it is important to look at a company's historical performance and compare the company ratios with its competitors and industry overall. A price/sales ratio is derived by dividing stock market price by company sales. The P/S ratio for RMBS is 2.1, which is relatively high. In young companies, a high P/S ratio is a sign of sales growth that is expected to turn into earnings and cash flow. It is important to compare P/S ratios for companies in the same industry, as ratios can vary quite widely for companies in different industries.

At $31.74, Veeco Instruments (Nasdaq:VECO) has slipped 9.2%. At 1.2 million shares, the company's volume so far today is 2.1 times its current daily average. 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 provide investors with an estimation, albeit a simplistic one, of the value of a stock. One of the favorite tools of many value investors is analyzing price/book value ratios, as it provides a measure of the underlying value of a company's assets as compared to the valuation of its equity. The P/B ratio for VECO is 1.56, indicating that the stock is trading for more than its book value. This may be a sign that the company is overvalued. 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: How Buybacks Warps The Price-To-Book Ratio

MakeMyTrip (Nasdaq:MMYT) has increased to a share price of $17.97, a 7.9% rise. The company's volume is currently 11,206 shares. This is on pace to fall short of yesterday's volume of 33,551 shares. A stock's volume conveys how excited investors are about it. A company's value as an investment is more easily estimated using valuation ratios such as the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield. The capitalization ratio measures the debt component of the capital structure, or capitalization of a company (i.e., the sum of long-term debt liabilities and shareholder equity) to support operations and growth. MMYT's capitalization ratio is 0.2%, which is relatively low. Investors generally consider a company with low debt and high equity levels is a good quality investment. The capitalization ratio is one of the more meaningful debt ratios because it focuses on the relationship of debt liabilities as a component of a company's total capital base, which is the capital raised by shareholders and lenders.

Cymer (Nasdaq:CYMI) is down 5.6% to reach $52.13 per share. So far today, the company's volume is 168,040 shares, 0.6 times the 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/earnings ratio is calculated by taking a stock price and dividing it by the earnings-per-share (EPS). CYMI has a P/E ratio of 31.9, in line with the industry average. 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: The P/E Ratio: A Good Market-Timing Indicator

Slipping 5.2%, Citrix (Nasdaq:CTXS) is currently trading at $76.97 per share. So far today, the company's volume is one million shares. When a stock price moves up or down, watching the volume is a good way of identifying how significant that shift is. Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. The price/earnings to growth (PEG) ratio can reveal value what price/earnings (P/E) ratios alone may not so that if a company has a high P/E ratio (an indication that its stock is overpriced) but its earnings are growing very quickly, the PEG ratio may reveal that the company is actually fairly valued, or perhaps even a bargain. CTXS' PEG ratio is 2.38. Because of the adjustment for earnings growth rate, the PEG ratio is somewhat more useful than many formulas for comparing companies in different industries.

Currently trading at $106.80 per share, Mellanox (Nasdaq:MLNX) has fallen 3.8%. At 486,182 shares, the company's volume so far today is 0.3 times the current daily average. 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 debt ratio shows the proportion of assets that a company is financing through debt. MLNX's debt ratio of 18% is on the low side. A low debt ratio means the company has more available cash flow. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.

Nortek (Nasdaq:NTK) is at $54.25 per share after an increase of 2.2%. So far today, 3,486 shares of the company's stock have changed hands. This is on pace to fall short of yesterday's volume of 115,138 shares. The trading volume for a stock indicates the level of investor interest. Valuation ratios like the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield are useful in determining how attractive a potential or existing investment is. While measuring a price/earnings ratio (P/E ratio) is a popular valuation technique, the measure cannot be calculated for companies without earnings, so some investors analyze the price/sales ratio. The P/S ratio for NTK is 0.34, which is relatively low. A company with a lower P/S ratio is generally considered more attractive, since investors are paying less for each dollar of sales. 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.

The Bottom Line No matter the economic climate, Wall Street will always have stocks that make major moves each week. Daily stock performance should be weighed against historical performance and put in context of the market overall. Keep in mind that all these ratios should be compared against historical numbers and industry information in order to get a more complete picture.

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