Trade-Ideas LLC identified

China Finance Online

(

JRJC

) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified China Finance Online as such a stock due to the following factors:

  • JRJC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.4 million.
  • JRJC has traded 149,073 shares today.
  • JRJC is trading at 6.03 times the normal volume for the stock at this time of day.
  • JRJC is trading at a new low 6.28% 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 JRJC:

TheStreet Recommends

China Finance Online Co., Limited provides Web-based financial services in the People's Republic of China and Hong Kong.

The average volume for China Finance Online has been 345,300 shares per day over the past 30 days. China Finance Online has a market cap of $143.0 million and is part of the technology sector and internet industry. Shares are up 16.5% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates China Finance Online as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, attractive valuation levels and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:

  • JRJC's very impressive revenue growth greatly exceeded the industry average of 15.1%. Since the same quarter one year prior, revenues leaped by 74.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • JRJC has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, JRJC has a quick ratio of 2.06, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Internet Software & Services industry and the overall market, CHINA FINANCE ONLINE CO -ADR's return on equity exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for CHINA FINANCE ONLINE CO -ADR is currently very high, coming in at 85.58%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 26.35% is above that of the industry average.

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