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Tickers in this Article: LCC, NAT, AAWW, KSU, GLF, UAL, CP
On a good day for the market, the Nasdaq has moved up 0.8%, the S&P 500 has climbed 0.7% and the Dow has risen 0.6%. The transportation sector is a category of stocks relating to the transportation of goods or customers. It is made up of airlines, railroads and trucking companies. The performance of the transportation sector is sensitive to the price of oil. Because operations revolve around the use of vehicles, fuel prices represent a significant cost to transportation companies. As the price of oil rises, transportation companies will be expected to earn less. Inversely, these companies do well when the cost of fuel decreases.

The Transportation sector (IYT) is up 0.6%, underperforming the market overall. The biggest movers in the sector are currently:
CompanyMarket CapPercentage Change
US Airways Group (NYSE:LCC).76 billion-7.2%
Nordic American Tanker Shipping Limited (NYSE:NAT)7.5 million+6.4%
Atlas Air Worldwide Holdings, Inc. (Nasdaq:AAWW).37 billion+5.5%
Kansas City Southern (NYSE:KSU).07 billion+2.2%
GulfMark Offshore, Inc. (NYSE:GLF)9.1 million+2%
United Continental Holdings Inc (NYSE:UAL).14 billion-1.9%
Canadian Pacific Railway Limited (USA) (NYSE:CP).22 billion+1.7%
Forex Broker Summary: Forex Capital Markets (FXCM)

Falling 7.2%, US Airways (NYSE:LCC) is currently at a share price of $10.03. This morning, the company is trading a volume of 6.8 million shares. When a stock price moves up or down, watching the volume is a good way of identifying how significant that shift is. Investment valuation ratios can be very useful in estimating whether a stock price is too high, reasonable or a bargain investment opportunity. 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. LCC has a high D/E ratio of 877%. Generally, a high D/E ratio means that the company may have difficulty generating enough cash to pay off its debts. The D/E ratio is not a pure measurement of a company's debt because it includes operational liabilities in total liabilities.

Nordic American Tanker (NYSE:NAT) has increased to a share price of $12.42, a 6.4% rise. The company's volume for the day so far is two million shares, 1.6 times the current three-month average. 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. Investment valuation ratios provide investors with an estimation, albeit a simplistic one, of the value of a stock. 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. NAT has a fairly low capitalization ratio of 21.4%. 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.

Atlas Air Worldwide Holdings (Nasdaq:AAWW) is up 5.5% to reach a current price of $54.63 per share. So far this morning, 152,886 shares have changed hands. This is in keeping with its current daily average. If a stock price moves on high volume, this means that the change is a significant one. 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 assumption with high price/earnings stocks (generally of the growth variety) is that investors are willing to buy at a high price because they believe that the stock has significant growth potential, and the price/earnings to growth (PEG) ratio helps investors determine the degree of reliability of that growth assumption. PEG ratio for AAWW is consistent with the industry average at 0.82. Because of the adjustment for earnings growth rate, the PEG ratio is somewhat more useful than many formulas for comparing companies in different industries.

Rising 2.2%, Kansas City (NYSE:KSU) is currently trading at $74.97 per share. This morning, 314,978 shares have been traded, consistent with the volume from yesterday. If a stock is trading on low volume, then there is not much interest in the stock. On the other hand, if a stock is trading on high volume, then there is a lot of interest in the stock. When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. The price/book value ratio provides a way of evaluating whether a stock is relatively cheap or expensive. KSU's stock is trading for more than its book value with a P/B ratio of 2.81. This high share price relative to asset value is likely to indicate that the company has been earning a very high return on its assets. 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

GulfMark Offshore (NYSE:GLF) is at $37.08 per share after an increase of 2%. The company's volume for the day so far is 34,181 shares. 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. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. The price/sales ratio measures a company's stock market value by its total revenues or alternatively, a company's price per share by its revenue per share. GLF's P/S ratio of 2.32 is on the high side. This could be a good sign if the share price increases. A limitation of the P/S ratio is that the price component measures only stock market captialization, while sales are a function of the entire capital structure, potentially leading to wide differences between levered and unlevered companies.

United Continental Holdings (NYSE:UAL) has fallen 1.9% and is currently trading at $18.14 per share. So far today, the company's volume is 2.3 million shares, 0.4 times its current three-month average. High volume indicates a lot of investor interest while low volume indicates the opposite. 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. UAL has a debt ratio of 95.8%, which is on the high side. This might mean that the company now has low borrowing capacity, which reduces it's financial flexibility. 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.

Canadian Pacific Railway Limited (NYSE:CP) is currently trading at $84.42 per share, a 1.7% increase. The company's volume for the morning is 256,893 shares. This is 0.3 times the average daily volume. If a stock price makes a big move up or down, volume lets us know the significance of that move. 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. The debt-equity (D/E) ratio compares the total liabilities for a company to its total shareholder equity. The D/E ratio for CP is 97%. 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.

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. However, these fundamental metrics must be analyzed with historic data, industry information in addition to firm specific financial statements.

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