Trade-Ideas LLC identified

Investment Technology Group

(

ITG

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

  • ITG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.2 million.
  • ITG has traded 74,644 shares today.
  • ITG is trading at 8.80 times the normal volume for the stock at this time of day.
  • ITG is trading at a new low 3.02% 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.

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

More details on ITG:

TheStreet Recommends

Investment Technology Group, Inc. operates as an independent broker and financial technology company in the United States, Canada, Europe, and the Asia Pacific. The stock currently has a dividend yield of 1.3%. ITG has a PE ratio of 8. Currently there is 1 analyst that rates Investment Technology Group a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Investment Technology Group has been 271,600 shares per day over the past 30 days. Investment Technology Group has a market cap of $715.2 million and is part of the financial sector and financial services industry. The stock has a beta of 1.38 and a short float of 3.9% with 4.41 days to cover. Shares are up 27.7% year-to-date as of the close of trading on Wednesday.

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 Investment Technology Group as a

buy

. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, notable return on equity and impressive record of earnings per share growth. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 534.3% when compared to the same quarter one year prior, rising from $12.98 million to $82.34 million.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Capital Markets industry and the overall market, INVESTMENT TECHNOLOGY GP INC's return on equity exceeds that of both the industry average and the S&P 500.
  • INVESTMENT TECHNOLOGY GP INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, INVESTMENT TECHNOLOGY GP INC increased its bottom line by earning $2.65 versus $1.40 in the prior year. For the next year, the market is expecting a contraction of 75.5% in earnings ($0.65 versus $2.65).
  • ITG, with its decline in revenue, underperformed when compared the industry average of 1.8%. Since the same quarter one year prior, revenues fell by 21.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • ITG's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 27.09%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Looking ahead, the stock's sharp decline over the past year may have been what was needed in order to bring its value into alignment with its fundamentals and others in its industry.

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.