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Starbucks and More Big Movers in Consumer/Non-Cyclical on September 5, 2012
On a good day for the market, the Nasdaq has climbed 0.2%, the S&P 500 has increased 0.2% and the Dow is trading up 0.3%.
The Consumer/Non-Cyclical sector (XLP) is up 0.1%, underperforming the market overall. The biggest movers in the sector are currently:
Forex Broker Summary: UFXMarkets
Falling 3.9%, Monster (Nasdaq:MNST) is currently at a share price of $54.99. The company's volume is currently 1.3 million shares for the day, 0.6 times its average over the past three months. High volume indicates a lot of investor interest while low volume indicates the opposite. 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. Using price/earnings ratios (P/E ratios) does not give an indication of whether or not an individual company's ratio is reasonable, a shortcoming that can be corrected by using the price/earnings to growth ratio (PEG ratio). PEG ratio for MNST is consistent with the industry average at 1.6. 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.
After rising 2.4%, Coca-Cola HBC S.A (NYSE:CCH) is currently trading at a share price of $18.53. So far today, the company's volume is 6,971 shares. Yesterday's volume was only 5,940 shares. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. 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. CCH's P/B ratio of 1.86 shows that its share price is higher than its book value. This implies that investors expect management to create more value from a given set of assets and/or that the market value of the firm's assets is significantly higher than their accounting value. To put things in perspective, should be made among companies in the same industry rather than across industries. SEE: Investment Valuation Ratios: Price/Book Value Ratio
Rising 2.3%, Mead Johnson (NYSE:MJN) is currently trading at $75.28 per share. The company's volume is currently 744,640 shares for the day, in line with the current daily average. A stock's volume conveys how excited investors are about it. 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 MJN is 1.6%, which is on the low end. This could indicate that that the stock is overpriced or that future dividends might be higher. High dividend yields are generally more important to value investors, investors in larger companies, and income oriented investors than they are to growth investors, investors in small cap stocks, and investors in new or emerging companies. SEE: Investment Valuation Ratios: Dividend Yield
After a decline of 2.2%, Fresh Del Monte Produce (NYSE:FDP) has hit a share price of $24.44. So far today, 67,120 shares have changed hands. 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. 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 debt-equity (D/E) ratio compares the total liabilities for a company to its total shareholder equity. FDP's debt-equity ratio of 2% is on the low end. This shows that the company's assets are financed primarily through equity. The D/E ratio is not a pure measurement of a company's debt because it includes operational liabilities in total liabilities.
After a decline of 1.7%, Lancaster (Nasdaq:LANC) has hit a share price of $71.81. So far today, the company's volume is 33,903 shares, consistent with its average over the last three months. In technical analysis, trading volume is used to determine the strength of a market indicator. Understanding investment valuation ratios allows an investor to assess the true value of an individual stock. The debt ratio is calculated by dividing total liabilities by total assets. LANC's debt ratio of 17.3% is on the low side. This indicates that the company engages in conservative financing with opportunities to borrow in the future at no significant risk. 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.
Starbucks (Nasdaq:SBUX) is at $50.34 per share after an increase of 1.7%. The company is trading at a volume of 3.2 million shares. This is about the same trading activity as there was yesterday. If a stock price moves on high volume, this means that the change is a significant one. 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. A price/sales ratio is derived by dividing stock market price by company sales. The P/S ratio for SBUX is a high 3.12. 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.
Tejon Ranch (NYSE:TRC) has moved up 1.6% and is currently trading at $28.51 per share. The company's volume is currently 6,344 shares for the day, 0.2 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. 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. 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. TRC has a fairly low capitalization ratio of 0.1%. A low capitalization ratio can signify a failure to leverage equity into investment, missing valuable opportunities for growth and expansion. 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 No matter the economic climate, Wall Street will always have stocks that make major moves each week. 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.
The Consumer/Non-Cyclical sector (XLP) is up 0.1%, underperforming the market overall. The biggest movers in the sector are currently:
| Company | Market Cap | Percentage Change |
| Monster (Nasdaq:MNST) | $10.1 billion | -3.9% |
| Coca-Cola HBC S.A (NYSE:CCH) | $6.57 billion | +2.4% |
| Mead Johnson (NYSE:MJN) | $15 billion | +2.3% |
| Fresh Del Monte Produce (NYSE:FDP) | $1.45 billion | -2.2% |
| Lancaster (Nasdaq:LANC) | $1.99 billion | -1.7% |
| Starbucks (Nasdaq:SBUX) | $37.63 billion | +1.7% |
| Tejon Ranch (NYSE:TRC) | $563.4 million | +1.6% |
Falling 3.9%, Monster (Nasdaq:MNST) is currently at a share price of $54.99. The company's volume is currently 1.3 million shares for the day, 0.6 times its average over the past three months. High volume indicates a lot of investor interest while low volume indicates the opposite. 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. Using price/earnings ratios (P/E ratios) does not give an indication of whether or not an individual company's ratio is reasonable, a shortcoming that can be corrected by using the price/earnings to growth ratio (PEG ratio). PEG ratio for MNST is consistent with the industry average at 1.6. 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.
After rising 2.4%, Coca-Cola HBC S.A (NYSE:CCH) is currently trading at a share price of $18.53. So far today, the company's volume is 6,971 shares. Yesterday's volume was only 5,940 shares. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. 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. CCH's P/B ratio of 1.86 shows that its share price is higher than its book value. This implies that investors expect management to create more value from a given set of assets and/or that the market value of the firm's assets is significantly higher than their accounting value. To put things in perspective, should be made among companies in the same industry rather than across industries. SEE: Investment Valuation Ratios: Price/Book Value Ratio
Rising 2.3%, Mead Johnson (NYSE:MJN) is currently trading at $75.28 per share. The company's volume is currently 744,640 shares for the day, in line with the current daily average. A stock's volume conveys how excited investors are about it. 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 MJN is 1.6%, which is on the low end. This could indicate that that the stock is overpriced or that future dividends might be higher. High dividend yields are generally more important to value investors, investors in larger companies, and income oriented investors than they are to growth investors, investors in small cap stocks, and investors in new or emerging companies. SEE: Investment Valuation Ratios: Dividend Yield
After a decline of 2.2%, Fresh Del Monte Produce (NYSE:FDP) has hit a share price of $24.44. So far today, 67,120 shares have changed hands. 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. 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 debt-equity (D/E) ratio compares the total liabilities for a company to its total shareholder equity. FDP's debt-equity ratio of 2% is on the low end. This shows that the company's assets are financed primarily through equity. The D/E ratio is not a pure measurement of a company's debt because it includes operational liabilities in total liabilities.
After a decline of 1.7%, Lancaster (Nasdaq:LANC) has hit a share price of $71.81. So far today, the company's volume is 33,903 shares, consistent with its average over the last three months. In technical analysis, trading volume is used to determine the strength of a market indicator. Understanding investment valuation ratios allows an investor to assess the true value of an individual stock. The debt ratio is calculated by dividing total liabilities by total assets. LANC's debt ratio of 17.3% is on the low side. This indicates that the company engages in conservative financing with opportunities to borrow in the future at no significant risk. 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.
Starbucks (Nasdaq:SBUX) is at $50.34 per share after an increase of 1.7%. The company is trading at a volume of 3.2 million shares. This is about the same trading activity as there was yesterday. If a stock price moves on high volume, this means that the change is a significant one. 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. A price/sales ratio is derived by dividing stock market price by company sales. The P/S ratio for SBUX is a high 3.12. 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.
Tejon Ranch (NYSE:TRC) has moved up 1.6% and is currently trading at $28.51 per share. The company's volume is currently 6,344 shares for the day, 0.2 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. 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. 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. TRC has a fairly low capitalization ratio of 0.1%. A low capitalization ratio can signify a failure to leverage equity into investment, missing valuable opportunities for growth and expansion. 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 No matter the economic climate, Wall Street will always have stocks that make major moves each week. 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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