Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified

Big 5 Sporting Goods

(

BGFV

) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Big 5 Sporting Goods as such a stock due to the following factors:

  • BGFV has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $3.4 million.
  • BGFV has traded 214,128 shares today.
  • BGFV is trading at 36.79 times the normal volume for the stock at this time of day.
  • BGFV is trading at a new low 18.33% below yesterday's close.

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of 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 (or avoid losses by trimming weak positions). 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.

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More details on BGFV:

Big 5 Sporting Goods Corporation operates as a sporting goods retailer in the western United States. The stock currently has a dividend yield of 2.7%. BGFV has a PE ratio of 21. Currently there are no analysts that rate Big 5 Sporting Goods a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Big 5 Sporting Goods has been 134,500 shares per day over the past 30 days. Big 5 Sporting Goods has a market cap of $327.1 million and is part of the services sector and specialty retail industry. The stock has a beta of 1.88 and a short float of 2.6% with 1.72 days to cover. Shares are up 1.8% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Big 5 Sporting Goods as a

buy

. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, revenue growth, reasonable valuation levels and good cash flow from operations. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:

  • The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Specialty Retail industry average. The net income increased by 12.3% when compared to the same quarter one year prior, going from $2.06 million to $2.31 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 8.8%. Since the same quarter one year prior, revenues slightly increased by 5.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • Net operating cash flow has significantly increased by 473.62% to $19.51 million when compared to the same quarter last year. In addition, BIG 5 SPORTING GOODS CORP has also vastly surpassed the industry average cash flow growth rate of 30.50%.

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