Trade-Ideas LLC identified

Sohu.com

(

SOHU

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

  • SOHU has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $10.9 million.
  • SOHU has traded 151,098 shares today.
  • SOHU is trading at 9.42 times the normal volume for the stock at this time of day.
  • SOHU is trading at a new low 7.08% 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 SOHU:

Sohu.com Inc. provides online media, search, and game services on personal computers (PCs), mobile devices, and tablets in the People's Republic of China. Currently there are 2 analysts that rate Sohu.com a buy, 1 analyst rates it a sell, and 2 rate it a hold.

The average volume for Sohu.com has been 289,400 shares per day over the past 30 days. Sohu.com has a market cap of $2.0 billion and is part of the technology sector and internet industry. The stock has a beta of 1.15 and a short float of 2.4% with 2.39 days to cover. Shares are down 0.4% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Sohu.com as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.

Highlights from the ratings report include:

  • SOHU's revenue growth has slightly outpaced the industry average of 15.2%. Since the same quarter one year prior, revenues rose by 21.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Although SOHU's debt-to-equity ratio of 0.27 is very low, it is currently higher than that of the industry average. To add to this, SOHU has a quick ratio of 2.00, which demonstrates the ability of the company to cover short-term liquidity needs.
  • SOHU.COM INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, SOHU.COM INC reported poor results of -$4.47 versus -$0.47 in the prior year. This year, the market expects an improvement in earnings (-$0.23 versus -$4.47).
  • The gross profit margin for SOHU.COM INC is rather high; currently it is at 68.95%. Regardless of SOHU's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SOHU's net profit margin of 7.49% is significantly lower than the industry average.
  • 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 Internet Software & Services industry and the overall market, SOHU.COM INC's return on equity significantly trails that of both the industry average and the S&P 500.

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