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

Jive Software

(

JIVE

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

  • JIVE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $3.0 million.
  • JIVE has traded 1.0 million shares today.
  • JIVE is trading at 8.37 times the normal volume for the stock at this time of day.
  • JIVE is trading at a new low 4.11% 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 JIVE:

Jive Software, Inc. provides communication and collaboration solutions to businesses, government agencies, and other enterprises. The company's Jive Platform allows companies to connect, communicate, and collaborate with employees, customers, and partners. Currently there are 2 analysts that rate Jive Software a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Jive Software has been 517,800 shares per day over the past 30 days. Jive Software has a market cap of $413.7 million and is part of the technology sector and computer software & services industry. The stock has a beta of 0.39 and a short float of 5.2% with 3.38 days to cover. Shares are down 7.1% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Jive Software as a

sell

. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • JIVE'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 30.53%, 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. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • 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 Software industry and the overall market, JIVE SOFTWARE INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for JIVE SOFTWARE INC is currently very high, coming in at 72.23%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -17.32% is in-line with the industry average.
  • Net operating cash flow has significantly increased by 671.04% to $14.57 million when compared to the same quarter last year. In addition, JIVE SOFTWARE INC has also vastly surpassed the industry average cash flow growth rate of -17.70%.
  • JIVE's debt-to-equity ratio is very low at 0.07 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.13, which illustrates the ability to avoid short-term cash problems.

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