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Tickers in this Article: RMBS, PANL, CY, MLNX, AIXG, MU, MTSI
The market is having a bad day so far: the Nasdaq has decreased 0.7%; the S&P 500 has declined 0.7%; and the Dow is down 0.8%.

The Semiconductors sector (XLK) is down 0.5%, outperforming the market overall. Currently, the biggest movers in the sector are:
CompanyMarket CapPercentage Change
Rambus Inc. (Nasdaq:RMBS)5.8 million-15.6%
Universal Display Corporation (Nasdaq:PANL).75 billion-8.2%
Cypress Semiconductor Corporation (Nasdaq:CY).77 billion-6.6%
Mellanox Technologies, Ltd. (Nasdaq:MLNX).73 billion-5.7%
AIXTRON SE (ADR) (Nasdaq:AIXG).4 billion-5.5%
Micron Technology (Nasdaq:MU).88 billion+4.4%
M\x2FA-COM Technology Solutions Holdings (Nasdaq:MTSI)1.4 million-3.8%
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Shares of Rambus (Nasdaq:RMBS) are currently trading at $4.40, a steep decline of 15.6%. The company is currently trading a volume of 1.4 million 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. 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. RMBS' P/S ratio of 2.28 is on the high side. 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 compare P/S ratios for companies in the same industry, as ratios can vary quite widely for companies in different industries.

Universal (Nasdaq:PANL) is down 8.2% to reach $34.60 per share. So far today, the company's volume is 578,507 shares, 1.1 times the average volume over the last three months. 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. The P/E ratio has been used for ages by analysts and still remains one of the most relevant pieces of stock valuation. PANL's P/E ratio is 190.3. A high or low P/E ratio is not good or bad in and of itself, but a company trading with a high P/E ratio must continue to post strong financial performance or its stock price is likely to fall. SEE: How To Find P/E And PEG Ratios

Cypress (Nasdaq:CY) is trading at $10.83 per share, down 6.6%. So far this morning, 2.8 million shares have changed hands. This is 0.8 times its average daily volume. In technical analysis, trading volume is used to determine the strength of a market indicator. 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 divides a company's P/E ratio by its growth rate of earnings-per-share. PEG ratio for CY is 2.08. Because of the adjustment for earnings growth rate, the PEG ratio is somewhat more useful than many formulas for comparing companies in different industries.

Mellanox (Nasdaq:MLNX) has fallen 5.7% and is currently trading at $88.58 per share. At 946,505 shares, the company's volume so far today is which is likely to result in less activity than yesterday's volume of 6.4 million shares. High volume indicates a lot of investor interest while low volume indicates the opposite. 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. 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. MLNX has a P/B ratio of 7.64 which shows that its share price is higher than its book value. This may be a sign that the company is overvalued. To put things in perspective, should be made among companies in the same industry rather than across industries. SEE: How Buybacks Warps The Price-To-Book Ratio

AIXTRON SE (Nasdaq:AIXG) has decreased to $12.96 per share, a 5.5% fall. The company's volume for the day so far is 77,216 shares. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. Investment valuation ratios provide investors with an estimation, albeit a simplistic one, of the value of a stock. Dividend yield measures the income that a stock will generate for an investor. The dividend yield for AIXG is 1.6%, which is on the low end. If you are an income investor, this stock may not be attractive to you. For income-oriented investors such as retirees, a stock with a high dividend yield may be more attractive than a stock with a low dividend yield. SEE: Due Diligence On Dividends

Micron (Nasdaq:MU) is up 4.4% to reach a current price of $6.03 per share. The company's volume for the day so far is 23.2 million shares, 0.8 times its current three-month average. When a stock price moves up or down, watching the volume is a good way of identifying how significant that shift is. 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 debt-equity (D/E) ratio is a leverage ratio. MU has a debt-equity ratio of 41%, which is on the low side. A low D/E ratio may be a sign that the company is not taking advantage of leverage to increase its profits. 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.

Falling 3.8%, M\x2FA-COM Technology Solutions (Nasdaq:MTSI) is currently at a share price of $16.58. The company's volume for the morning is 5,449 shares. This is 0.2 times the average daily volume. If a stock price moves on high volume, this means that the change is a significant one. 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 debt ratio is calculated by dividing total liabilities by total assets. The debt ratio for MTSI is 52.2%. 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 No matter the economic climate, Wall Street will always have stocks that make major moves each week. Daily stock performance should be weighed against historical performance and put in context of the market overall. 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.

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