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Consumer/Non-Cyclical Sector's Biggest Movers for July 11, 2012
The Nasdaq has slipped 0.5%, the S&P 500 has moved little and the Dow has decreased 0.2% so far today.
As with the overall market, the Consumer/Non-Cyclical sector has shown little movement, but here are its current biggest movers:
Broker Summary: E-Trade Financial
Slipping 7.5%, Coca-Cola FEMSA, S.A.B. de C.V (NYSE:KOF) is currently trading at $123.14 per share. This morning, the company is trading a volume of 605,342 shares. 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. There are many tools investors can use to evaluate a stock, including margins. Margins, quite simply, are earnings expressed as a ratio, or a percentage of sales, and this allows investors to compare the profitability of different companies, while net earnings, which are presented as an absolute number, cannot. KOF's gross profit margin is 45.8%. Investors trying to assess a company's ability to continue to pay its fixed expenses even if its business declines may want to evaluate the operating margin ratio. KOF's operating profit margin is 12.9%. Net profit margins are those generated from all phases of a business, including taxes. The company has a net profit margin of 8.4%.
Valuation ratios allow the investor to make a quick determination as to a company's investment value. There are generally two price/earnings ratios calculated: the first, called the trailing Price/Earnings ratio, is calculated using the previous years actual earnings; the second, called forward Price/Earnings ratio, is calculated using the next year's estimated earnings. KOF has a P/E ratio of 62.6, high compared to the industry average of 21.27. Generally speaking, the higher the P/E ratio, the higher the market expectations for a company's future performance. High P/E stocks could be "growth" stocks, while low PE stocks may be "value" stocks. SEE: Understanding The P/E Ratio
Falling 4.9%, Dean Foods (NYSE:DF) is currently at a share price of $15.26. The company's volume is currently 2.1 million shares for the day, lighter than yesterday's volume of four million shares. In technical analysis, trading volume is used to determine the strength of a market indicator. Margin analysis tells us how effectively management can wring profits from sales and how much room a company has to withstand a downturn, fend off competition and make mistakes. The gross profit margin for DF is 25.2%. Operating margin is determined by taking operating income (income minus variable expenses) and dividing it by sales. The operating margin for DF is 3.8%, which is low compared its gross profit margin. Tracking net profit margin over time for a single company can be a valuable tool for seeing how a business is developing. The company has a negative net profit margin of -11.9%. This shows that the company reported a net loss in the most recent quarter.
Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. 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. DF's capitalization ratio of 101.5% is relatively high. A company considered too highly leveraged (too much debt) may find its freedom of action restricted by its creditors and/or have its profitability hurt by high interest costs. This ratio is considered to be one of the more meaningful of the "debt" ratios - it delivers the key insight into the use of leverage by a company.
Fomento Economico Mexicano SAB (NYSE:FMX) is down 2.7% to reach $87.43 per share. This morning, the company's volume is 312,284 shares. This is 0.4 times the current daily average. A stock's volume conveys how excited investors are about it. Profit-margin ratios can give investors deeper insight into management efficiency than earnings alone can provide. Gross profit margin, operating profit margin and net margin are commonly used margins. FMX has a gross profit margin of 41.8%. Investors in growth stocks or short-term traders may be less interested in the operating margin ratio. Operating profit margin for FMX is 9.7%. Ideally, a company's profit margin should be stable or rising; declining profit margin should be cause for concern or further investigation. The company's net profit margin is 9.1%.
Investment valuation ratios can be very useful in estimating whether a stock price is too high, reasonable or a bargain investment opportunity. 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. PEG ratio for FMX is 0.7. 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.
Post Holdings (NYSE:POST) is trading at $31.03 per share, down 2.7%. The company's volume for the day so far is 922,204 share, 5.3 times its current three-month average. Volume is used to evaluate how meaningful the price movement of a stock is. Profit-margin ratios help us to keep score, as measured over time, of management's ability to generate profits and manage costs and expenses. There are three key profit-margin ratios: gross profit margin, operating profit margin and net profit margin. The gross profit margin for POST is 44.1%. Net profit margin comes as close as possible to summing-up in a single figure how effectively managers run the business. Net profit margin is -55.6%. A negative net profit margin means the company spent more money than it made. Operating profit gives investors an opportunity to do profit-margin comparisons between companies that do not issue a separate disclosure of their cost of goods sold figures (which are needed to do gross margin analysis). POST's operating profit margin is 13.3%.
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. 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. POST's P/B ratio of 0.71 indicates that its share price is lower than its book value. This is due to one of two possibilities: that the stock is being unfairly or incorrectly undervalued by investors because of some transitory circumstance and represents an attractive buying opportunity at a bargain price or that the market's low opinion and valuation of the company are correct, at least over the foreseeable future. All else being equal, a stock with a low P/B value ratio is more attractive than a stock with a high ratio. SEE: How Buybacks Warps The Price-To-Book Ratio
Currently trading at $37.70 per share, Cal-Maine Foods (Nasdaq:CALM) has fallen 2.6%. The company is currently trading a volume of 59,851 shares. Volume is an important indicator because it indicates how significant a price shift is. Margin ratios highlight companies that are worth further examination. CALM has a low gross profit margin of 18.7%. This may mean that the company is struggling to control production costs, or that a low amount of earnings is being generated from revenues. CALM's operating margin of 11.5% and net margin of 5.5% are low relative to its gross margin.
It is important for an investor to estimate the value of any potential or existing investment; valuation ratios make this easier. The dividend yield is calculated by dividing a company's dividends per share by its stock price. Dividend yield for CALM is 3.8%. It is important to remember that dividends are only one component of a stock's return and capital appreciation (or decline) must also be considered when evaluating a security. SEE: Dividend Yield For The Downturn
Nu Skin Enterprises (NYSE:NUS) has fallen 2.6% and is currently trading at $45.62 per share. This morning, 271,333 shares have been traded, while it was 1.2 million shares yesterday. As a stock moves up or down, it is important to pay attention to the trading volume. This indicates the level of interest: the higher the volume, the more the interest. There are many tools investors can use to evaluate a stock, including margins. Margins, quite simply, are earnings expressed as a ratio, or a percentage of sales, and this allows investors to compare the profitability of different companies, while net earnings, which are presented as an absolute number, cannot. NUS has a relatively high gross profit margin of 83.6%. This means that the company will have a lot of money left over to spend on other business operations, such as research and development or marketing. Compared with its gross profit margin, NUS' operating profit margin of 15.5% and net profit margin of 10.3% are high.
Investors can make use of valuation ratios to estimate whether a stock is fairly valued. A price/sales ratio is derived by dividing stock market price by company sales. NUS' P/S ratio of 2.02 is on the high side. This could be a good sign if the share price increases. 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.
Mead Johnson (NYSE:MJN) has risen 2.5% and is currently trading at $77.14 per share. So far today, the company's volume is four million shares. This is 1.3 times its current daily average. 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 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. Profit-margin ratios measure how much money a company squeezes from its total revenue or total sales. Investors can look at a company's gross profit margin, operating profit margin and net margin to understand a company's profitability. MJN's gross profit margin is 64.4%. A high net profit margin indicates a highly profitable company, and a low profit margin indicates the opposite. The company's net margin of 14% is high relative to its gross profit margin. Investors in companies with high profit margins can be confident that even if sales dip slightly, profits will remain strong. Operating margin can be an important ratio for some investors, particularly those investing in weaker companies or companies in cyclical industries. Operating profit margin for MJN is 25.2%.
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 debt ratio is calculated by dividing total liabilities by total assets. MJN has a debt ratio of 102.6%, which is on the high side. This means that the company's cash flow is significantly impacted by paying off principal and interest and that any negative change in performance or rise in interest rates could result in default. 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.
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.
As with the overall market, the Consumer/Non-Cyclical sector has shown little movement, but here are its current biggest movers:
| Company | Market Cap | Percentage Change |
| Coca-Cola FEMSA, S.A.B. de C.V. (ADR) (NYSE:KOF) | $24.59 billion | -7.5% |
| Dean Foods (NYSE:DF) | $2.96 billion | -4.9% |
| Fomento Economico Mexicano SAB (ADR) (NYSE:FMX) | $160.82 billion | -2.7% |
| Post Holdings Inc (NYSE:POST) | $1.1 billion | -2.7% |
| Cal-Maine Foods Inc (Nasdaq:CALM) | $924 million | -2.6% |
| Nu Skin Enterprises, Inc. (NYSE:NUS) | $2.96 billion | -2.6% |
| Mead Johnson Nutrition (NYSE:MJN) | $15.35 billion | +2.5% |
Slipping 7.5%, Coca-Cola FEMSA, S.A.B. de C.V (NYSE:KOF) is currently trading at $123.14 per share. This morning, the company is trading a volume of 605,342 shares. 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. There are many tools investors can use to evaluate a stock, including margins. Margins, quite simply, are earnings expressed as a ratio, or a percentage of sales, and this allows investors to compare the profitability of different companies, while net earnings, which are presented as an absolute number, cannot. KOF's gross profit margin is 45.8%. Investors trying to assess a company's ability to continue to pay its fixed expenses even if its business declines may want to evaluate the operating margin ratio. KOF's operating profit margin is 12.9%. Net profit margins are those generated from all phases of a business, including taxes. The company has a net profit margin of 8.4%.
Valuation ratios allow the investor to make a quick determination as to a company's investment value. There are generally two price/earnings ratios calculated: the first, called the trailing Price/Earnings ratio, is calculated using the previous years actual earnings; the second, called forward Price/Earnings ratio, is calculated using the next year's estimated earnings. KOF has a P/E ratio of 62.6, high compared to the industry average of 21.27. Generally speaking, the higher the P/E ratio, the higher the market expectations for a company's future performance. High P/E stocks could be "growth" stocks, while low PE stocks may be "value" stocks. SEE: Understanding The P/E Ratio
Falling 4.9%, Dean Foods (NYSE:DF) is currently at a share price of $15.26. The company's volume is currently 2.1 million shares for the day, lighter than yesterday's volume of four million shares. In technical analysis, trading volume is used to determine the strength of a market indicator. Margin analysis tells us how effectively management can wring profits from sales and how much room a company has to withstand a downturn, fend off competition and make mistakes. The gross profit margin for DF is 25.2%. Operating margin is determined by taking operating income (income minus variable expenses) and dividing it by sales. The operating margin for DF is 3.8%, which is low compared its gross profit margin. Tracking net profit margin over time for a single company can be a valuable tool for seeing how a business is developing. The company has a negative net profit margin of -11.9%. This shows that the company reported a net loss in the most recent quarter.
Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. 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. DF's capitalization ratio of 101.5% is relatively high. A company considered too highly leveraged (too much debt) may find its freedom of action restricted by its creditors and/or have its profitability hurt by high interest costs. This ratio is considered to be one of the more meaningful of the "debt" ratios - it delivers the key insight into the use of leverage by a company.
Fomento Economico Mexicano SAB (NYSE:FMX) is down 2.7% to reach $87.43 per share. This morning, the company's volume is 312,284 shares. This is 0.4 times the current daily average. A stock's volume conveys how excited investors are about it. Profit-margin ratios can give investors deeper insight into management efficiency than earnings alone can provide. Gross profit margin, operating profit margin and net margin are commonly used margins. FMX has a gross profit margin of 41.8%. Investors in growth stocks or short-term traders may be less interested in the operating margin ratio. Operating profit margin for FMX is 9.7%. Ideally, a company's profit margin should be stable or rising; declining profit margin should be cause for concern or further investigation. The company's net profit margin is 9.1%.
Investment valuation ratios can be very useful in estimating whether a stock price is too high, reasonable or a bargain investment opportunity. 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. PEG ratio for FMX is 0.7. 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.
Post Holdings (NYSE:POST) is trading at $31.03 per share, down 2.7%. The company's volume for the day so far is 922,204 share, 5.3 times its current three-month average. Volume is used to evaluate how meaningful the price movement of a stock is. Profit-margin ratios help us to keep score, as measured over time, of management's ability to generate profits and manage costs and expenses. There are three key profit-margin ratios: gross profit margin, operating profit margin and net profit margin. The gross profit margin for POST is 44.1%. Net profit margin comes as close as possible to summing-up in a single figure how effectively managers run the business. Net profit margin is -55.6%. A negative net profit margin means the company spent more money than it made. Operating profit gives investors an opportunity to do profit-margin comparisons between companies that do not issue a separate disclosure of their cost of goods sold figures (which are needed to do gross margin analysis). POST's operating profit margin is 13.3%.
Currently trading at $37.70 per share, Cal-Maine Foods (Nasdaq:CALM) has fallen 2.6%. The company is currently trading a volume of 59,851 shares. Volume is an important indicator because it indicates how significant a price shift is. Margin ratios highlight companies that are worth further examination. CALM has a low gross profit margin of 18.7%. This may mean that the company is struggling to control production costs, or that a low amount of earnings is being generated from revenues. CALM's operating margin of 11.5% and net margin of 5.5% are low relative to its gross margin.
It is important for an investor to estimate the value of any potential or existing investment; valuation ratios make this easier. The dividend yield is calculated by dividing a company's dividends per share by its stock price. Dividend yield for CALM is 3.8%. It is important to remember that dividends are only one component of a stock's return and capital appreciation (or decline) must also be considered when evaluating a security. SEE: Dividend Yield For The Downturn
Nu Skin Enterprises (NYSE:NUS) has fallen 2.6% and is currently trading at $45.62 per share. This morning, 271,333 shares have been traded, while it was 1.2 million shares yesterday. As a stock moves up or down, it is important to pay attention to the trading volume. This indicates the level of interest: the higher the volume, the more the interest. There are many tools investors can use to evaluate a stock, including margins. Margins, quite simply, are earnings expressed as a ratio, or a percentage of sales, and this allows investors to compare the profitability of different companies, while net earnings, which are presented as an absolute number, cannot. NUS has a relatively high gross profit margin of 83.6%. This means that the company will have a lot of money left over to spend on other business operations, such as research and development or marketing. Compared with its gross profit margin, NUS' operating profit margin of 15.5% and net profit margin of 10.3% are high.
Investors can make use of valuation ratios to estimate whether a stock is fairly valued. A price/sales ratio is derived by dividing stock market price by company sales. NUS' P/S ratio of 2.02 is on the high side. This could be a good sign if the share price increases. 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.
Mead Johnson (NYSE:MJN) has risen 2.5% and is currently trading at $77.14 per share. So far today, the company's volume is four million shares. This is 1.3 times its current daily average. 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 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. Profit-margin ratios measure how much money a company squeezes from its total revenue or total sales. Investors can look at a company's gross profit margin, operating profit margin and net margin to understand a company's profitability. MJN's gross profit margin is 64.4%. A high net profit margin indicates a highly profitable company, and a low profit margin indicates the opposite. The company's net margin of 14% is high relative to its gross profit margin. Investors in companies with high profit margins can be confident that even if sales dip slightly, profits will remain strong. Operating margin can be an important ratio for some investors, particularly those investing in weaker companies or companies in cyclical industries. Operating profit margin for MJN is 25.2%.
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 debt ratio is calculated by dividing total liabilities by total assets. MJN has a debt ratio of 102.6%, which is on the high side. This means that the company's cash flow is significantly impacted by paying off principal and interest and that any negative change in performance or rise in interest rates could result in default. 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.
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.
by
Investopedia Staff
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