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

Kandi Technologies Group

(

KNDI

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

  • KNDI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.6 million.
  • KNDI has traded 231,187 shares today.
  • KNDI is trading at 2.58 times the normal volume for the stock at this time of day.
  • KNDI is trading at a new low 8.12% 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 KNDI:

Kandi Technologies Group, Inc., through its subsidiaries, designs, develops, manufactures, and commercializes electric vehicles (EVs), EV parts, and off-road vehicles in the People's Republic of China and internationally. KNDI has a PE ratio of 1.

The average volume for Kandi Technologies Group has been 814,400 shares per day over the past 30 days. Kandi Technologies Group has a market cap of $355.5 million and is part of the consumer goods sector and automotive industry. The stock has a beta of 1.16 and a short float of 21.7% with 18.99 days to cover. Shares are down 45.5% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Kandi Technologies Group as a

hold

. 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 and notable return on equity. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, weak operating cash flow and poor profit margins.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 8.6%. Since the same quarter one year prior, revenues slightly increased by 9.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • KNDI's debt-to-equity ratio is very low at 0.25 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 1.05, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has significantly decreased to -$9.48 million or 211.12% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • KNDI'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 60.14%, 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. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.

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