Trade-Ideas LLC identified

Houghton Mifflin Harcourt

(

HMHC

) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Houghton Mifflin Harcourt as such a stock due to the following factors:

  • HMHC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $10.8 million.
  • HMHC has traded 79,179 shares today.
  • HMHC is trading at 3.40 times the normal volume for the stock at this time of day.
  • HMHC is trading at a new high 3.01% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into 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. 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 HMHC:

Houghton Mifflin Harcourt Company provides education solutions for educational institutions and consumers worldwide. It delivers content, technology, and services to approximately 50 million students. The company operates in two segments, Education and Trade Publishing. Currently there are 2 analysts that rate Houghton Mifflin Harcourt a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Houghton Mifflin Harcourt has been 1.0 million shares per day over the past 30 days. Houghton Mifflin Harcourt has a market cap of $2.4 billion and is part of the services sector and diversified services industry. Shares are down 19.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Houghton Mifflin Harcourt as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and a generally disappointing performance in the stock itself.

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 Diversified Consumer Services industry. The net income increased by 22.5% when compared to the same quarter one year prior, going from $107.03 million to $131.08 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 11.4%. Since the same quarter one year prior, revenues slightly increased by 4.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The gross profit margin for HOUGHTON MIFFLIN HARCOURT CO is rather high; currently it is at 59.03%. Regardless of HMHC's high profit margin, it has managed to decrease from the same period last year.
  • Net operating cash flow has decreased to $298.16 million or 31.11% when compared to the same quarter last year. Despite a decrease in cash flow HOUGHTON MIFFLIN HARCOURT CO is still fairing well by exceeding its industry average cash flow growth rate of -73.85%.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Diversified Consumer Services industry and the overall market, HOUGHTON MIFFLIN HARCOURT CO's return on equity significantly trails that of both the industry average and the S&P 500.

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