So far today, the Nasdaq has remained steady, the S&P 500 has declined 0.1% and the Dow has slipped 0.5%.
On a quiet day for the market overall so far, the Semiconductors sector (XLK) has slipped 0.1% and its biggest movers are currently:
|Company||Market Cap||Percentage Change|
|Peregrine Semiconductor Corp (Nasdaq:PSMI)||$518.3 million||+5.7%|
|International (NYSE:IRF)||$1.15 billion||-5.2%|
|FEI (Nasdaq:FEIC)||$2.01 billion||-4%|
|OmniVision Technologies (Nasdaq:OVTI)||$736.2 million||+3.3%|
|Microsemi (Nasdaq:MSCC)||$1.73 billion||-2.1%|
|Spreadtrum Communications, Inc (Nasdaq:SPRD)||$955.9 million||+1.8%|
|Diodes (Nasdaq:DIOD)||$791.1 million||-1.8%|
Forex Broker Summary: Forex Capital Markets (FXCM)
Peregrine Semiconductor Corp (Nasdaq:PSMI) has increased to a share price of $17.45, a 5.7% rise. So far today, 40,968 shares have changed hands. Volume indicates the level of interest that investors have in a company at its current price.
International (NYSE:IRF) is currently trading at a share price of $15.78, a 5.2% decline. So far today, the company's volume is 637,702 shares, 1.3 times its current daily average. Volume is used to evaluate how meaningful the price movement of a stock is. Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. 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. IRF's P/B ratio of 0.86 indicates that its share price is lower than its book value. Industries that require more infrastructure capital (for each dollar of profit) will usually trade at P/B ratios much lower than those that don't. 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
Falling 4%, FEI (Nasdaq:FEIC) is currently at a share price of $50.74. So far today, the company's volume is 503,729 shares. This is more trading activity than there was yesterday. The trading volume for a stock indicates the level of investor interest. It is important for an investor to estimate the value of any potential or existing investment; valuation ratios make this easier. 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 FEIC is a high 2.12. In young companies, a high P/S ratio is a sign of sales growth that is expected to turn into earnings and cash flow. All things being equal, a low P/S ratio is good news for investors, while a very high one can be a warning sign.
Increasing 3.3%, OmniVision Technologies (Nasdaq:OVTI) is trading at $14.21 per share. With 1.1 million shares changing hands so far today, the company's volume is in keeping with its current three-month average. Volume is used to evaluate how meaningful the price movement of a stock is. 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 easy-to-calculate debt ratio is helpful to investors looking for a quick take on the leverage for a company. OVTI has a debt ratio of 34%, which is fairly low. 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.
Microsemi (Nasdaq:MSCC) is trading at $19.06 per share, down 2.1%. This morning, the company is trading a volume of 171,221 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. To a large degree, the debt-equity (D/E) ratio provides another vantage point on a company's leverage position, in this case, comparing total liabilities to shareholders' equity, as opposed to total assets in the debt ratio. MSCC has a D/E ratio of 90%. 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.
Spreadtrum Communications, Inc (Nasdaq:SPRD) has risen 1.8% to hit a current price of $20.71 per share. At 110,828 shares, the company's volume so far today is 0.1 times the average daily volume. 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. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. The capitalization ratio is calculated by dividing long-term debt by the sum of long-term debt and shareholders' equity. SPRD has a low capitalization ratio of 5.7%. Investors generally consider a company with low debt and high equity levels is a good quality investment. 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.
Currently trading at $16.89 per share, Diodes (Nasdaq:DIOD) has fallen 1.8%. The company's volume for the day so far is 62,360 shares. At this rate, trading activity will likely be down from yesterday when 222,173 shares changed hands. 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. One of the most important estimates of stock market valuation is the price/earnings ratio (P/E ratio). The P/E ratio for DIOD is 33.1, above the industry average of 14.5. Generally speaking, the higher the P/E ratio, the higher the market expectations for a company's future performance. From the investor's perspective, a stock with a lower ratio is relatively cheaper than a stock with a higher ratio. SEE: The P/E Ratio: A Good Market-Timing Indicator
The Bottom Line No matter the economic climate, Wall Street will always have stocks that make major moves each week. Paying close attention to the previous ratios will help you identify key times to adjust your strategy. Keep in mind that all these ratios should be compared against historical numbers and industry information in order to get a more complete picture.