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Baidu and Other Technology Stocks Making Big Moves on October 1, 2012
The market is having a good day so far: the Nasdaq is up 0.7%; the S&P 500 is trading up 1%; and the Dow has increased 1.1%. The technology sector is a category of stocks relating to the research, development and/or distribution of technologically based goods and services. This sector contains businesses revolving around the manufacturing of electronics, creation of software, computers or products and services relating to information technology. The technology sector offers a wide arrange of products and services for both customers and other businesses. Consumer goods like personal computers, stereos and televisions are continually improved and upgraded, offering the latest technology to all users. Businesses receive information and services from software and database systems, which allow the companies to make strategic business decisions.
The Technology sector (XLK) is up 0.7%, outperforming the market overall. The biggest movers in the sector so far are:
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Generac Holdings (NYSE:GNRC) is up 9.7% to reach a current price of $25.11 per share. The company is trading at a volume of 799,061 shares. Yesterday, volume was only 151,727 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. 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 easy-to-calculate debt ratio is helpful to investors looking for a quick take on the leverage for a company. The debt ratio for GNRC is 72.9%, which is relatively high. This might mean that the company now has low borrowing capacity, which reduces it's financial flexibility. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.
Baidu (Nasdaq:BIDU) is down 3.5% to reach $112.75 per share. At 3.3 million shares, the company's volume so far today is 0.6 times the average volume over the last three months. Volume is an important indicator in technical analysis as it is used to measure the worth of a market move. If the markets have made a strong price move either up or down the perceived strength of that move depends on the volume for that period. The higher the volume during that price move the more significant the move. In making a decision about a potential or existing investment, valuation ratios are useful as a basis for seeing whether the stock price is too high, reasonable, or a bargain. The debt-equity (D/E) ratio compares the total liabilities for a company to its total shareholder equity. BIDU has a low debt-equity ratio of 12%. A low D/E ratio may be a sign that the company is not taking advantage of leverage to increase its profits. The D/E ratio is not a pure measurement of a company's debt because it includes operational liabilities in total liabilities.
Slipping 3.4%, Imperva (NYSE:IMPV) is currently trading at $35.73 per share. So far today, the company's volume is 35,099 shares. If a stock price makes a big move up or down, volume lets us know the significance of that move. 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 price/book value ratio is one of the more common methods of determining whether a stock is fairly valued. IMPV's stock is trading for more than its book value with a P/B ratio of 10.7. This high share price relative to asset value is likely to indicate that the company has been earning a very high return on its assets. A weakness of the P/B value ratio is that while the price component is easily determined by looking at the stock quote, the book value component is more difficult to estimate and more open to individual interpretation and analysis. SEE: Using The Price-To-Book Ratio To Evaluate Companies
After rising 3.1%, Danaher (NYSE:DHR) is currently trading at a share price of $56.85. The company's volume is currently 2.2 million shares for the day, in keeping with its current daily average. When a stock price moves up or down, watching the volume is a good way of identifying how significant that shift is. Understanding investment valuation ratios allows an investor to assess the true value of an individual stock. The price/sales ratio is used for spotting recovery situations or for double-checking that a company's growth has not become overvalued. DHR's P/S ratio of 2.24 is on the high side. This could be a good sign if the share price increases. 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 2.7%, CommVault Systems (Nasdaq:CVLT) is currently at a share price of $57.06. The company's volume for the day so far is 240,253 shares. This is about the same trading activity as there was 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. When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. The debt ratio shows the proportion of assets that a company is financing through debt. The debt ratio for CVLT is a low 43%. 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. However, one thing to note with this ratio: it isn't a pure measure of a company's debt (or indebtedness), as it also includes operational liabilities, such as accounts payable and taxes payable.
At $46.96, Check Point Software (Nasdaq:CHKP) has slipped 2.5%. With 1.1 million shares changing hands so far today, the company's volume is in keeping with its current three-month average. In technical analysis, trading volume is used to determine the strength of a market indicator. 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 P/E ratio has been used for ages by analysts and still remains one of the most relevant pieces of stock valuation. The P/E ratio for CHKP is 17.4, above the industry average of 5.3. This could mean that the market is expecting big things over the next few months or years. A high P/E ratio indicates a stock that is expensive, while a low P/E ratio indicates a stock that is cheap. SEE: Profit With The Power Of Price-To-Earnings
After a decline of 2.2%, MICROS Systems (Nasdaq:MCRS) has hit a share price of $48.06. The company is currently trading a volume of 333,628 shares. Volume is an important indicator because it indicates how significant a price shift is. In making a decision about a potential or existing investment, valuation ratios are useful as a basis for seeing whether the stock price is too high, reasonable, or a bargain. Using price/earnings ratios (P/E ratios) does not give an indication of whether or not an individual company's ratio is reasonable, a shortcoming that can be corrected by using the price/earnings to growth ratio (PEG ratio). MCRS' PEG ratio of 1.61 is in line with the industry average. 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.
The Bottom Line On any given day, a particular stock may see positive or negative change in its share price. It is important to weigh current activity against historical performance when making any investment decisions. However, these fundamental metrics must be analyzed with historic data, industry information in addition to firm specific financial statements.
The Technology sector (XLK) is up 0.7%, outperforming the market overall. The biggest movers in the sector so far are:
| Company | Market Cap | Percentage Change |
| Generac Holdings (NYSE:GNRC) | $1.56 billion | +9.7% |
| Baidu (Nasdaq:BIDU) | $40.84 billion | -3.5% |
| Imperva (NYSE:IMPV) | $871.9 million | -3.4% |
| Danaher (NYSE:DHR) | $38.35 billion | +3.1% |
| CommVault Systems (Nasdaq:CVLT) | $2.64 billion | -2.7% |
| Check Point Software (Nasdaq:CHKP) | $9.98 billion | -2.5% |
| MICROS Systems (Nasdaq:MCRS) | $3.94 billion | -2.2% |
Generac Holdings (NYSE:GNRC) is up 9.7% to reach a current price of $25.11 per share. The company is trading at a volume of 799,061 shares. Yesterday, volume was only 151,727 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. 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 easy-to-calculate debt ratio is helpful to investors looking for a quick take on the leverage for a company. The debt ratio for GNRC is 72.9%, which is relatively high. This might mean that the company now has low borrowing capacity, which reduces it's financial flexibility. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.
Baidu (Nasdaq:BIDU) is down 3.5% to reach $112.75 per share. At 3.3 million shares, the company's volume so far today is 0.6 times the average volume over the last three months. Volume is an important indicator in technical analysis as it is used to measure the worth of a market move. If the markets have made a strong price move either up or down the perceived strength of that move depends on the volume for that period. The higher the volume during that price move the more significant the move. In making a decision about a potential or existing investment, valuation ratios are useful as a basis for seeing whether the stock price is too high, reasonable, or a bargain. The debt-equity (D/E) ratio compares the total liabilities for a company to its total shareholder equity. BIDU has a low debt-equity ratio of 12%. A low D/E ratio may be a sign that the company is not taking advantage of leverage to increase its profits. The D/E ratio is not a pure measurement of a company's debt because it includes operational liabilities in total liabilities.
Slipping 3.4%, Imperva (NYSE:IMPV) is currently trading at $35.73 per share. So far today, the company's volume is 35,099 shares. If a stock price makes a big move up or down, volume lets us know the significance of that move. 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 price/book value ratio is one of the more common methods of determining whether a stock is fairly valued. IMPV's stock is trading for more than its book value with a P/B ratio of 10.7. This high share price relative to asset value is likely to indicate that the company has been earning a very high return on its assets. A weakness of the P/B value ratio is that while the price component is easily determined by looking at the stock quote, the book value component is more difficult to estimate and more open to individual interpretation and analysis. SEE: Using The Price-To-Book Ratio To Evaluate Companies
Falling 2.7%, CommVault Systems (Nasdaq:CVLT) is currently at a share price of $57.06. The company's volume for the day so far is 240,253 shares. This is about the same trading activity as there was 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. When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. The debt ratio shows the proportion of assets that a company is financing through debt. The debt ratio for CVLT is a low 43%. 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. However, one thing to note with this ratio: it isn't a pure measure of a company's debt (or indebtedness), as it also includes operational liabilities, such as accounts payable and taxes payable.
At $46.96, Check Point Software (Nasdaq:CHKP) has slipped 2.5%. With 1.1 million shares changing hands so far today, the company's volume is in keeping with its current three-month average. In technical analysis, trading volume is used to determine the strength of a market indicator. 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 P/E ratio has been used for ages by analysts and still remains one of the most relevant pieces of stock valuation. The P/E ratio for CHKP is 17.4, above the industry average of 5.3. This could mean that the market is expecting big things over the next few months or years. A high P/E ratio indicates a stock that is expensive, while a low P/E ratio indicates a stock that is cheap. SEE: Profit With The Power Of Price-To-Earnings
After a decline of 2.2%, MICROS Systems (Nasdaq:MCRS) has hit a share price of $48.06. The company is currently trading a volume of 333,628 shares. Volume is an important indicator because it indicates how significant a price shift is. In making a decision about a potential or existing investment, valuation ratios are useful as a basis for seeing whether the stock price is too high, reasonable, or a bargain. Using price/earnings ratios (P/E ratios) does not give an indication of whether or not an individual company's ratio is reasonable, a shortcoming that can be corrected by using the price/earnings to growth ratio (PEG ratio). MCRS' PEG ratio of 1.61 is in line with the industry average. 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.
The Bottom Line On any given day, a particular stock may see positive or negative change in its share price. It is important to weigh current activity against historical performance when making any investment decisions. However, these fundamental metrics must be analyzed with historic data, industry information in addition to firm specific financial statements.
by
Investopedia Staff
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