Free Annual Reports
Technology Stocks, Including Baidu, Making Big Moves on August 20, 2012
This morning's trading has marked a bad day for the market so far. The Nasdaq has slipped 0.2%; the S&P 500 has decreased 0.3%; and the Dow is trading down 0.2%. The technology sector is a category of stocks relating to the research, development and/or distribution of technologically based goods and services. This sector contains businesses revolving around the manufacturing of electronics, creation of software, computers or products and services relating to information technology. The technology sector offers a wide arrange of products and services for both customers and other businesses. Consumer goods like personal computers, stereos and televisions are continually improved and upgraded, offering the latest technology to all users. Businesses receive information and services from software and database systems, which allow the companies to make strategic business decisions.
The Technology sector (XLK) is currently ahead of the overall market, down only 0.2%, and its biggest movers are currently:
Beginner's Guide To Thinkorswim Trading Platform
QIHOO 360 (NYSE:QIHU) is at $20.10 per share after an increase of 8.4%. So far today, the company's volume is 1.7 million shares. This is 1.3 times the average daily volume. 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. 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. QIHU has a high P/S ratio of 13.66. 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.
At $26.28, Ellie Mae (NYSE:ELLI) has slipped 8%. So far today, the company's volume is 1.1 million shares, 2.2 times the current three-month average. As a stock moves up or down, it is important to pay attention to the trading volume. This indicates the level of interest: the higher the volume, the more the interest. 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/book value ratio provides a way of evaluating whether a stock is relatively cheap or expensive. ELLI's stock is trading for more than its book value with a P/B ratio of 7.3. 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. One problem with the P/B value ratio is that it can be difficult to calculate the true book value of a company, so investors should be aware that many measures of book value may provide only a rough estimate, and should be taken with a grain of salt. SEE: Investment Valuation Ratios: Price/Book Value Ratio
After an increase of 6.5%, First Solar (Nasdaq:FSLR) has reached a current price of $22.65. The company's volume for the day so far is 4.2 million shares. Volume is an important indicator because it indicates how significant a price shift is. 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. FSLR's debt-equity ratio of 15% is on the low end. A low D/E ratio may be a sign that the company is not taking advantage of leverage to increase its profits. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.
Veeco Instruments (Nasdaq:VECO) has decreased to $33.90 per share, a 6.2% fall. The company's volume is currently 405,364 shares for the day, with trading activity in keeping with yesterday's. If a stock price moves on high volume, this means that the change is a significant one. 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. VECO has a fairly low capitalization ratio of 0.3%. Investors generally consider a company with low debt and high equity levels is a good quality investment. A low level of debt and a healthy proportion of equity in a company's capital structure is an indication of financial fitness.
athenahealth (Nasdaq:ATHN) is currently trading at a share price of $87.85, a 4.9% decline. This morning, the company's volume is 213,703 shares. This is consistent with its current daily average. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. 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 ratio is calculated by taking a stock price and dividing it by the earnings-per-share (EPS). ATHN has a P/E ratio of 200.0, high compared to the industry average of 46.31. 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 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 Use The P/E Ratio And PEG To Tell The Future Of A Stock
Sourcefire (Nasdaq:FIRE) is down 3.8% to reach $49.19 per share. With 193,561 shares changing hands so far today, the company's volume is 0.4 times its current three-month average. If a stock price makes a big move up or down, volume lets us know the significance of that move. When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. 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). FIRE has a PEG ratio of 9.86. 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 a decline of 2.6%, Baidu (Nasdaq:BIDU) has hit a share price of $130.50. So far today, 1.6 million shares have changed hands. 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. The debt ratio for BIDU is a low 29.9%. In other words, the company is less sensitive to changes in business or interest rates since less of its cash flow is dedicated to paying off loan expenses. 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 On any given day, a particular stock may see positive or negative change in its share price. Daily stock performance should be weighed against historical performance and put in context of the market overall. Keep in mind that all these ratios should be compared against historical numbers and industry information in order to get a more complete picture.
The Technology sector (XLK) is currently ahead of the overall market, down only 0.2%, and its biggest movers are currently:
| Company | Market Cap | Percentage Change |
| QIHOO 360 (NYSE:QIHU) | $2.14 billion | +8.4% |
| Ellie Mae (NYSE:ELLI) | $719.9 million | -8% |
| First Solar (Nasdaq:FSLR) | $1.85 billion | +6.5% |
| Veeco Instruments (Nasdaq:VECO) | $1.42 billion | -6.2% |
| athenahealth (Nasdaq:ATHN) | $3.33 billion | -4.9% |
| Sourcefire (Nasdaq:FIRE) | $1.53 billion | -3.8% |
| Baidu (Nasdaq:BIDU) | $46.81 billion | -2.6% |
QIHOO 360 (NYSE:QIHU) is at $20.10 per share after an increase of 8.4%. So far today, the company's volume is 1.7 million shares. This is 1.3 times the average daily volume. 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. 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. QIHU has a high P/S ratio of 13.66. 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.
At $26.28, Ellie Mae (NYSE:ELLI) has slipped 8%. So far today, the company's volume is 1.1 million shares, 2.2 times the current three-month average. As a stock moves up or down, it is important to pay attention to the trading volume. This indicates the level of interest: the higher the volume, the more the interest. 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/book value ratio provides a way of evaluating whether a stock is relatively cheap or expensive. ELLI's stock is trading for more than its book value with a P/B ratio of 7.3. 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. One problem with the P/B value ratio is that it can be difficult to calculate the true book value of a company, so investors should be aware that many measures of book value may provide only a rough estimate, and should be taken with a grain of salt. SEE: Investment Valuation Ratios: Price/Book Value Ratio
After an increase of 6.5%, First Solar (Nasdaq:FSLR) has reached a current price of $22.65. The company's volume for the day so far is 4.2 million shares. Volume is an important indicator because it indicates how significant a price shift is. 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. FSLR's debt-equity ratio of 15% is on the low end. A low D/E ratio may be a sign that the company is not taking advantage of leverage to increase its profits. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.
athenahealth (Nasdaq:ATHN) is currently trading at a share price of $87.85, a 4.9% decline. This morning, the company's volume is 213,703 shares. This is consistent with its current daily average. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. 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 ratio is calculated by taking a stock price and dividing it by the earnings-per-share (EPS). ATHN has a P/E ratio of 200.0, high compared to the industry average of 46.31. 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 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 Use The P/E Ratio And PEG To Tell The Future Of A Stock
Sourcefire (Nasdaq:FIRE) is down 3.8% to reach $49.19 per share. With 193,561 shares changing hands so far today, the company's volume is 0.4 times its current three-month average. If a stock price makes a big move up or down, volume lets us know the significance of that move. When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. 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). FIRE has a PEG ratio of 9.86. 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 a decline of 2.6%, Baidu (Nasdaq:BIDU) has hit a share price of $130.50. So far today, 1.6 million shares have changed hands. 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. The debt ratio for BIDU is a low 29.9%. In other words, the company is less sensitive to changes in business or interest rates since less of its cash flow is dedicated to paying off loan expenses. 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 On any given day, a particular stock may see positive or negative change in its share price. Daily stock performance should be weighed against historical performance and put in context of the market overall. Keep in mind that all these ratios should be compared against historical numbers and industry information in order to get a more complete picture.
by
Investopedia Staff
Investopedia.com believes that individuals can excel at managing their financial affairs. As such, we strive to provide free educational content and tools to empower individual investors, including thousands of original and objective articles and tutorials on a wide variety of financial topics.
Free Annual Reports
