GNC Holdings Inc. (GNC) shares fall following downgrade at Barclays PLC

GNC Holdings Inc. (NYSE: GNC) shares fell on Tuesday Dec 13 with lower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a downgraded rating.

Meanwhile, the Dow DJIA, +0.47% climbed 106 points, or 0.6%, to 19,905. If the Dow finishes higher, it will notch its seventh straight gain.

The S&P 500 index SPX, +0.56% gained 10.45 points, or 0.5%, to 2,267 and the tech-heavy Nasdaq Composite Index COMP, +1.02% added 48 points, or 0.9%, to 5,461.

Both the S&P 500 index SPX, +0.56% and Nasdaq Composite COMP, +1.02% ended lower on Monday, with investors appearing reluctant to push shares higher ahead of the Fed meeting

Shares of GNC Holdings Inc. (NYSE: GNC) were downgraded by analysts at Barclays PLC in a note to their investors today. With a rating of Underweight on the shares, the company has a 52-week high of $35.90. The one-year price target of $14.83 is above the opening price of $13.47, causing a fair amount of other analysts to comment on the stock in recent days. Downgrades occur when analysts believe that the future prospects for the security have diminished from the original recommendation, often because of a considerable and integral change in the company’s actions, future outlook or industry.

GNC Holdings Inc. (NYSE: GNC) shares last traded at $13.25, which represents a dip of $0.66 per share or -4.74% compared to the previous closing price. Opening at $13.47, they ranged from $13.04 and $13.51 throughout the day.

GNC Holdings Inc. (NYSE: GNC) now has a market cap of 906.29M.

GNC Holdings Inc. (NYSE: GNC) Average Daily Trading Volume

552,943 shares traded hands yesterday, below normal, out of a total float 67,926,000. Investors often use increases in trading volume to determine substantial volume accumulation or dissemination by institutional investors, so trading volume is likely to increase in the next few days.

While increased trading for short periods will not mean much, however, a trend of heavy trading volume on the buy side over a period of days or weeks sends a positive cue to market traders that institutions may be moving in, so institutional sponsorship is crucial.

Institutional sponsorship just refers to ownership of a stock by mutual funds, banks, pension funds and other large institutions.

These professional investors retain teams of analysts researching thousands of stocks. Thus, watching their interests is a good way to ensure you are buying the right stocks.

GNC Holdings Inc. (NYSE: GNC) Moving Averages

A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.

This is because the average acts like a floor (support), so the price bounces up off of it.

In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.

By identifying trends, moving averages allow traders to make those trends work in their favor and increase the number of winning trades.

With that in mind, GNC Holdings Inc. (NYSE: GNC) now has a 50-day MA of $14.76 and 200-day MA of $20.58. It has traded in a 52-week range between $12.78 – 35.90 and today’s last price is 63.09%% lower than the 52 week high of $35.90.

Earnings growth is a critical factor to look at when buying stocks and investors identify companies that have grown their earnings at least 25% or more for a 3 year period.

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