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Tickers in this Article: TK, GLNG, HII, PAC, RRTS, GLF, AAWW
After the morning's trading, the Nasdaq is unchanged, the S&P 500 is down 0.3% and the Dow has moved little. 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) has fallen 0.3% despite little change in the market overall. The biggest movers in the sector so far are:
CompanyMarket CapPercentage Change
Teekay (NYSE:TK)$2.26 billion+2.6%
Golar LNG Limited (Nasdaq:GLNG)$3.2 billion+2.1%
Huntington Ingalls Industries (NYSE:HII)$2.01 billion+2%
Grupo Aeroportuario del Pacifico (NYSE:PAC)$2.24 billion-1.5%
Roadrunner Transportation Systems (NYSE:RRTS)$557.3 million-1.4%
GulfMark Offshore (NYSE:GLF)$926.6 million+1.3%
Atlas Air Worldwide Holdings (Nasdaq:AAWW)$1.46 billion+1.2%
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Teekay (NYSE:TK) has risen 2.6% to hit a current price of $32.54 per share. The company's volume is currently 157,726 shares for the day, consistent with its current daily average. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. In a nutshell, the price/sales ratio shows how much Wall Street values every dollar of the company's sales. TK's P/S ratio of 1.03 is on the high side. 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.

Rising 2.1%, Golar LNG Limited (Nasdaq:GLNG) is currently trading at $39.44 per share. The company is trading at a volume of 298,750 shares. This is on pace to reach yesterday's trading volume of 575,440 shares. High volume indicates a lot of investor interest while low volume indicates the opposite. 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. There are generally two price/earnings ratios calculated: the first, called the trailing Price/Earnings ratio, is calculated using the previous years actual earnings; the second, called forward Price/Earnings ratio, is calculated using the next year's estimated earnings. Compared to the industry average of 13.08, GLNG's P/E ratio of 65.4 is quite high. Generally speaking, the higher the P/E ratio, the higher the market expectations for a company's future performance. To determine the P/E ratio, an investor divides the market price of the stock by the earnings-per-share (EPS) of the stock. SEE: Understanding The P/E Ratio

Huntington Ingalls Industries (NYSE:HII) has moved up 2% and is currently trading at $42.51 per share. So far today, the company's volume is 291,079 shares, 0.9 times the average volume over the last three months. 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. 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. HII has a capitalization ratio of 64.5%, which is on the high end. If the company is a company is in a highly competitive business and hobbled by high debt, it will find its competitors taking advantage of its problems to grab more market share. Prudent use of leverage (debt) increases the financial resources available to a company for growth and expansion.

Grupo Aeroportuario del Pacifico (NYSE:PAC) has decreased to $40.25 per share, a 1.5% fall. So far today, 56,093 shares have changed hands. 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. Valuation ratios include 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. Dividend yield is a way to measure how much cash flow you are getting for each dollar invested in an equity position - in other words, how much "bang for your buck" you are getting from dividends. Dividend yield for PAC is 5.5%. A stock's dividend yield depends on the nature of a company's business, its posture in the marketplace (value or growth oriented), its earnings and cash flow, and its dividend policy. SEE: Dividend Yield For The Downturn

Falling 1.4%, Roadrunner Transportation Systems (NYSE:RRTS) is currently at a share price of $17.36. The company's volume is currently 43,407 shares for the day, 0.3 times the average daily volume. Volume indicates the level of interest that investors have in a company at its current price. Investment valuation ratios provide investors with an estimation, albeit a simplistic one, of the value of a stock. The price/book value ratio provides a way of evaluating whether a stock is relatively cheap or expensive. RRTS has a P/B ratio of 1.7 which 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. To put things in perspective, should be made among companies in the same industry rather than across industries. SEE: Using The Price-To-Book Ratio To Evaluate Companies

After an increase of 1.3%, GulfMark Offshore (NYSE:GLF) has reached a current price of $33.63. The company's volume is currently 119,332 shares. In technical analysis, trading volume is used to determine the strength of a market indicator. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. The debt ratio is calculated by dividing total liabilities by total assets. GLF's debt ratio of 34.8% 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. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.

Increasing 1.2%, Atlas Air Worldwide Holdings (Nasdaq:AAWW) is trading at $56.34 per share. With 98,172 shares changing hands so far today, the company's volume is 0.4 times its current three-month average. 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. 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 compares the total liabilities for a company to its total shareholder equity. AAWW has a D/E ratio of 76%. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.

The Bottom Line The nature of the market is such that stocks will have good days and bad days. Paying close attention to the previous ratios will help you identify key times to adjust your strategy. Keep in mind that all these ratios should be compared against historical numbers and industry information in order to get a more complete picture.

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