58.com (WUBA) Is Strong On High Volume Today

Trade-Ideas LLC identified 58.com (WUBA) as a strong on high relative volume candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

58.com

(

WUBA

) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified 58.com as such a stock due to the following factors:

  • WUBA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $57.9 million.
  • WUBA has traded 255,054 shares today.
  • WUBA is trading at 5.54 times the normal volume for the stock at this time of day.
  • WUBA is trading at a new high 7.08% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in WUBA with the Ticky from Trade-Ideas. See the FREE profile for WUBA NOW at Trade-Ideas

More details on WUBA:

58.com Inc. operates an online marketplace for local merchants and consumers in the People's Republic of China. Its online marketplace enables local merchants and consumers to connect, share information, and conduct business. WUBA has a PE ratio of 161. Currently there is 1 analyst that rates 58.com a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for 58.com has been 1.2 million shares per day over the past 30 days. 58.com has a market cap of $6.1 billion and is part of the technology sector and internet industry. Shares are up 30.8% year-to-date as of the close of trading on Tuesday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates 58.com as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity and feeble growth in its earnings per share.

Highlights from the ratings report include:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Internet Software & Services industry. The net income has significantly decreased by 340.6% when compared to the same quarter one year ago, falling from $11.18 million to -$26.89 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Internet Software & Services industry and the overall market, 58.COM INC -ADR's return on equity significantly trails that of both the industry average and the S&P 500.
  • 58.COM INC -ADR has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, 58.COM INC -ADR increased its bottom line by earning $0.27 versus $0.25 in the prior year. For the next year, the market is expecting a contraction of 918.5% in earnings (-$2.21 versus $0.27).
  • The gross profit margin for 58.COM INC -ADR is currently very high, coming in at 93.68%. Regardless of WUBA's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, WUBA's net profit margin of -16.85% significantly underperformed when compared to the industry average.
  • Looking at where the stock is today compared to one year ago, we find that it is higher, and it has outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Regardless of the rise in share value over the previous year, we feel that the risks involved in investing in this stock do not compensate for any future upside potential.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

Loading ...