Filed Under: ,
Tickers in this Article: TSO, VC, TLLP, CRM, BH, NC, IOC
The market is having a bad day so far: the Nasdaq has declined 0.3%; the S&P 500 has slipped 0.4%; and the Dow has fallen 0.5%. Formerly run as a private organization, the NYSE became a public entity in 2005 following the acquisition of electronic trading exchange Archipelago.

The biggest movers traded on the NYSE so far are:
CompanyMarket CapPercentage Change
Tesoro (NYSE:TSO)$4.96 billion+8.6%
Visteon Corporation (NYSE:VC)$2.04 billion+8.2%
Tesoro Logistics LP (NYSE:TLLP)$611 million+4.6% (NYSE:CRM)$19.3 billion+3.2%
Biglari Holdings Inc (NYSE:BH)$557.6 million-3.2%
NACCO Industries, Inc. (NYSE:NC)$882.7 million-3%
InterOil Corporation (USA) (NYSE:IOC)$4.38 billion-2.7%
Investopedia Markets: Explore the best one-stop source for financial news

Rising 8.6%, Tesoro (NYSE:TSO) is currently trading at $38.55 per share. So far today, 8.2 million shares of the company's stock have changed hands. This is greater than yesterday's volume of 3.1 million 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. Valuation ratios allow the investor to make a quick determination as to a company's investment value. A company's capitalization (not to be confused with its market capitalization) is the term used to describe the makeup of a company's permanent or long-term capital, which consists of both long-term debt and shareholders' equity. TSO has a fairly low capitalization ratio of 24.7%. A very low capitalization ratio might be a sign that the company is stagnating and reducing the potential earnings for shareholders. 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.

After rising 8.2%, Visteon (NYSE:VC) is currently trading at a share price of $42.00. So far today, the company's volume is 2.2 million shares. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. Investment valuation ratios can be very useful in estimating whether a stock price is too high, reasonable or a bargain investment opportunity. When used consistently and uniformly, the price/earnings to growth (PEG) ratio is an essential tool that adds dimension to the price/earnings ratio, allows comparisons across diverse industries and is always on the lookout for value. VC's PEG ratio is 2.11. 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.

Tesoro (NYSE:TLLP) has increased to a share price of $41.33, a 4.6% rise. The company's volume is currently 53,323 shares for the day, 0.8 times the average volume over the last three months. If a stock price makes a big move up or down, volume lets us know the significance of that move. 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. If the price/book value ratio of a stock is high, it may indicate that the stock is expensive, while a lower ratio may indicate that the stock is a bargain. TLLP has a P/B ratio of 7.71 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. P/B has its shortcomings but is still widely used as a valuation metric, more relevant for use by investors looking at capital-intensive or finance-related businesses, such as banks; book value does not carry much meaning for service-based firms with few tangible assets. SEE: How Buybacks Warps The Price-To-Book Ratio (NYSE:CRM) is up 3.2% to reach a current price of $144.37 per share. The company's volume for the day so far is 2.1 million shares. This is 0.8 times its average daily volume. 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. The price/sales ratio is used for spotting recovery situations or for double-checking that a company's growth has not become overvalued. CRM has a high P/S ratio of 8.68. 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.

Falling 3.2%, Biglari Holdings (NYSE:BH) is currently at a share price of $376.58. So far today, the company's volume is 1,597 shares, consistent with the volume from yesterday. 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. Valuation ratios include 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 debt ratio shows the proportion of assets that a company is financing through debt. BH's debt ratio is 56.5%. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.

After a decline of 3%, NACCO Industries (NYSE:NC) has hit a share price of $102.10. This morning, the company is trading a volume of 6,970 shares. 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. NC has a D/E ratio of 50%. This easy-to-calculate ratio provides a general indication of a company's equity-liability relationship and is helpful to investors looking for a quick take on a company's leverage.

Slipping 2.7%, InterOil Corporation (NYSE:IOC) is currently trading at $88.52 per share. The company's volume for the day so far is 288,563 shares, 0.6 times its average over the past three months. 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. The P/E ratio has been used for ages by analysts and still remains one of the most relevant pieces of stock valuation. IOC has a P/E ratio of 172.2, high compared to the industry average of 37.53. Generally speaking, the higher the P/E ratio, the higher the market expectations for a company's future performance. To determine the P/E ratio, an investor divides the market price of the stock by the earnings-per-share (EPS) of the stock. SEE: How To Use The P/E Ratio And PEG To Tell The Future Of A Stock

The Bottom Line The nature of the market is such that stocks will have good days and bad days. 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.

comments powered by Disqus

Trading Center