Filed Under: ,
Tickers in this Article: ZUMZ, CHU, VPRT, DG, EBAY, SNI, BAH
The market is doing well so far today. The Nasdaq has moved up 0.8%; the S&P 500 is trading up 0.8%; and the Dow has risen 0.9%.

Underperforming the market overall, the Services sector (IYC) is up 0.7%, and these are its current biggest movers:
CompanyMarket CapPercentage Change
Zumiez (Nasdaq:ZUMZ).01 billion-9.9%
China Unicom (Hong Kong) Limited (NYSE:CHU).59 billion-3.2%
VistaPrint (Nasdaq:VPRT).27 billion-2.7%
Dollar General (NYSE:DG).64 billion+2.3%
Ebay (Nasdaq:EBAY).99 billion+2.3%
Scripps (NYSE:SNI).73 billion+2.3%
Booz Allen (NYSE:BAH).54 billion-2%
Software Summary: Stock Screener

Currently trading at $29.04 per share, Zumiez (Nasdaq:ZUMZ) has fallen 9.9%. At 2.3 million shares, the company's volume so far today is 3.5 times the average daily volume. The trading volume for a stock indicates the level of investor interest. Understanding investment valuation ratios allows an investor to assess the true value of an individual stock. 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 ZUMZ is 25.4, above the industry average of 17.63. 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. A high P/E ratio indicates a stock that is expensive, while a low P/E ratio indicates a stock that is cheap. SEE: The P/E Ratio: A Good Market-Timing Indicator

China Unicom (Hong Kong) Limited (NYSE:CHU) is down 3.2% to reach $15.86 per share. The company's volume for the day so far is 364,547 shares. 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. A company's investment value can be 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 price/earnings to growth (PEG) ratio is calculated by dividing the price/earnings ratio by growth in earnings-per-share; the lower the PEG ratio, the more reasonably valued the security. CHU has a PEG ratio of 0.86, which is consistent with the industry average. Because of the adjustment for earnings growth rate, the PEG ratio is somewhat more useful than many formulas for comparing companies in different industries.

VistaPrint (Nasdaq:VPRT) is trading at $36.28 per share, down 2.7%. The company's volume for the day so far is 168,503 shares, 0.3 times its current three-month average. If a stock price moves on high volume, this means that the change is a significant one. 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 provides a way of evaluating whether a stock is relatively cheap or expensive. The P/B ratio for VPRT is 6.55, indicating that the stock is trading for more than its book value. It is important to take the company's debt into account when using the P/B ratio as debt can boost a company's liabilities to the point where they wipe out much of the book value of its hard assets, creating artificially high P/B values. 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: Using The Price-To-Book Ratio To Evaluate Companies

Increasing 2.3%, Dollar General (NYSE:DG) is trading at $51.24 per share. So far today, 1.3 million shares have changed hands. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. 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 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. The P/S ratio for DG is 1.03, 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 keep in mind when looking at the P/S ratio that just because a company is generating revenues, this does not mean that the company is profitable, and in the long run, profits drive stock prices.

Ebay (Nasdaq:EBAY) is up 2.3% to reach a current price of $47.63 per share. The company's volume is currently four million shares for the day, 0.4 times the average daily volume. Volume indicates the level of interest that investors have in a company at its current price. 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 shows the proportion of assets that a company is financing through debt. EBAY's debt ratio of 33.1% is on the low side. A low debt ratio means the company has more available cash flow. 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.

Scripps (NYSE:SNI) is currently trading at $59.89 per share, a 2.3% increase. So far today, the company's volume is 311,879 shares. This is about the same trading activity as there was yesterday. In technical analysis, trading volume is used to determine the strength of a market indicator. 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 debt-equity (D/E) ratio is a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed. SNI's D/E ratio is 94%. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.

Booz Allen (NYSE:BAH) has fallen 2% and is currently trading at $18.12 per share. So far today, the company's volume is 168,110 shares, 0.9 times its average over the past three months. Volume is used to evaluate how meaningful the price movement of a stock is. 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. BAH's capitalization ratio is 47.1%. 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.

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. Tools like valuation ratios and profit margins, however, are only as useful as the context you put them in; remember to take historical data and competitor performance into account.

comments powered by Disqus

Trading Center