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Reynolds Among Consumer/Non-Cyclical's Biggest Movers on October 3, 2012
The market has been doing well after the morning's trading. The Nasdaq is trading up 0.7%; the S&P 500 has climbed 0.5%; and the Dow has increased 0.3%.
Underperforming the market overall, the Consumer/Non-Cyclical sector (XLP) is up 0.6%, and these are its current biggest movers:
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Owens (NYSE:OC) has risen 3.3% and is currently trading at $34.83 per share. So far today, the company's volume is 742,280 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. 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. A company's price/earnings ratio (P/E ratio) provides a measure of how expensive or cheap a stock is. OC's P/E ratio of 24.8 is consistent with the industry average. A high P/E ratio indicates a stock that is expensive, while a low P/E ratio indicates a stock that is cheap. SEE: How To Find P/E And PEG Ratios
Constellation Brands, Inc (NYSE:STZ) is up 3.1% to reach a current price of $34.46 per share. At 3.3 million shares, the company's volume so far today is 1.5 times the current daily average. 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. The price/earnings to growth (PEG) ratio divides a company's P/E ratio by its growth rate of earnings-per-share. STZ has a PEG ratio of 1.42, 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.
B&G Foods (NYSE:BGS) is trading at $30.60 per share, down 2.4%. So far today, the company's volume is 2.2 million shares. The trading volume for a stock indicates the level of investor interest. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. The capitalization ratio measures the debt component of the capital structure, or capitalization of a company (i.e., the sum of long-term debt liabilities and shareholder equity) to support operations and growth. BGS has a capitalization ratio of 74.4%, which is on the high end. A high capitalization ratio is not necessarily bad since higher financial leverage can increase the return on a shareholder's investment. Prudent use of leverage (debt) increases the financial resources available to a company for growth and expansion.
Boston Beer Co (NYSE:SAM) has fallen 2% and is currently trading at $105.74 per share. So far today, the company's volume is 45,326 shares, consistent 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 estimating whether a stock price is too high, reasonable or a bargain investment opportunity. A price/sales ratio is derived by dividing stock market price by company sales. The P/S ratio for SAM is a high 2.88. This could be a good sign if the share price increases. 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.
Fresh Del Monte Produce (NYSE:FDP) is down 1.6% to reach $25.09 per share. The company's volume is currently 70,767 shares. If a stock price makes a big move up or down, volume lets us know the significance of that move. Valuation ratios allow the investor to make a quick determination as to a company's investment value. The debt ratio gives users a quick measure of the amount of debt that the company has on its balance sheets compared to its assets. FDP's debt ratio of 26.7% is on the low side. 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.
After an increase of 1.5%, Reynolds (NYSE:RAI) has reached a current price of $44.01. The company's volume is currently 475,934 shares for the day, 0.3 times the average daily volume. 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. It is important for an investor to estimate the value of any potential or existing investment; valuation ratios make this easier. The debt-equity (D/E) ratio is a leverage ratio. RAI's D/E ratio is 67%. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.
Currently trading at $19.41 per share, Flowers Foods (NYSE:FLO) has fallen 1.4%. The company's volume for the day so far is 333,342 shares. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. 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. 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. FLO's P/B ratio of 3.31 shows that its share price is higher 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. P/B value ratios are particularly useful to value investors, distressed or "vulture" investors, or any other investors purchasing beaten-down securities but are less useful to investors focused on growth stocks, purchasing IPOs, or investing in technology or other "asset-lite" companies. SEE: Investment Valuation Ratios: Price/Book Value Ratio
The Bottom Line The nature of the market is such that stocks will have good days and bad days. 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.
Underperforming the market overall, the Consumer/Non-Cyclical sector (XLP) is up 0.6%, and these are its current biggest movers:
| Company | Market Cap | Percentage Change |
| Owens (NYSE:OC) | $3.99 billion | +3.3% |
| Constellation Brands, Inc (NYSE:STZ) | $5.93 billion | +3.1% |
| B&G Foods (NYSE:BGS) | $1.52 billion | -2.4% |
| Boston Beer Co (NYSE:SAM) | $1.39 billion | -2% |
| Fresh Del Monte Produce (NYSE:FDP) | $1.48 billion | -1.6% |
| Reynolds (NYSE:RAI) | $24.52 billion | +1.5% |
| Flowers Foods (NYSE:FLO) | $2.73 billion | -1.4% |
Owens (NYSE:OC) has risen 3.3% and is currently trading at $34.83 per share. So far today, the company's volume is 742,280 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. 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. A company's price/earnings ratio (P/E ratio) provides a measure of how expensive or cheap a stock is. OC's P/E ratio of 24.8 is consistent with the industry average. A high P/E ratio indicates a stock that is expensive, while a low P/E ratio indicates a stock that is cheap. SEE: How To Find P/E And PEG Ratios
Constellation Brands, Inc (NYSE:STZ) is up 3.1% to reach a current price of $34.46 per share. At 3.3 million shares, the company's volume so far today is 1.5 times the current daily average. 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. The price/earnings to growth (PEG) ratio divides a company's P/E ratio by its growth rate of earnings-per-share. STZ has a PEG ratio of 1.42, 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.
B&G Foods (NYSE:BGS) is trading at $30.60 per share, down 2.4%. So far today, the company's volume is 2.2 million shares. The trading volume for a stock indicates the level of investor interest. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. The capitalization ratio measures the debt component of the capital structure, or capitalization of a company (i.e., the sum of long-term debt liabilities and shareholder equity) to support operations and growth. BGS has a capitalization ratio of 74.4%, which is on the high end. A high capitalization ratio is not necessarily bad since higher financial leverage can increase the return on a shareholder's investment. Prudent use of leverage (debt) increases the financial resources available to a company for growth and expansion.
Fresh Del Monte Produce (NYSE:FDP) is down 1.6% to reach $25.09 per share. The company's volume is currently 70,767 shares. If a stock price makes a big move up or down, volume lets us know the significance of that move. Valuation ratios allow the investor to make a quick determination as to a company's investment value. The debt ratio gives users a quick measure of the amount of debt that the company has on its balance sheets compared to its assets. FDP's debt ratio of 26.7% is on the low side. 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.
After an increase of 1.5%, Reynolds (NYSE:RAI) has reached a current price of $44.01. The company's volume is currently 475,934 shares for the day, 0.3 times the average daily volume. 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. It is important for an investor to estimate the value of any potential or existing investment; valuation ratios make this easier. The debt-equity (D/E) ratio is a leverage ratio. RAI's D/E ratio is 67%. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.
Currently trading at $19.41 per share, Flowers Foods (NYSE:FLO) has fallen 1.4%. The company's volume for the day so far is 333,342 shares. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. 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. 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. FLO's P/B ratio of 3.31 shows that its share price is higher 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. P/B value ratios are particularly useful to value investors, distressed or "vulture" investors, or any other investors purchasing beaten-down securities but are less useful to investors focused on growth stocks, purchasing IPOs, or investing in technology or other "asset-lite" companies. SEE: Investment Valuation Ratios: Price/Book Value Ratio
The Bottom Line The nature of the market is such that stocks will have good days and bad days. 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.
by
Investopedia Staff
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