Trade-Ideas LLC identified

Strayer Education

(

STRA

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

  • STRA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $6.0 million.
  • STRA has traded 56,867 shares today.
  • STRA is trading at 19.27 times the normal volume for the stock at this time of day.
  • STRA is trading at a new low 10.06% 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 STRA:

TST Recommends

Strayer Education, Inc., through its subsidiary, Strayer University, provides post-secondary education services for working adults in the United States. STRA has a PE ratio of 12. Currently there are no analysts that rate Strayer Education a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for Strayer Education has been 109,400 shares per day over the past 30 days. Strayer has a market cap of $625.4 million and is part of the services sector and diversified services industry. The stock has a beta of 1.40 and a short float of 17% with 11.31 days to cover. Shares are down 21.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Strayer Education as a

hold

. The company's strengths can be seen in multiple areas, such as its notable return on equity, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and feeble growth in the company's earnings per share.

Highlights from the ratings report include:

  • 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 Diversified Consumer Services industry and the overall market, STRAYER EDUCATION INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • STRA's debt-to-equity ratio of 0.96 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 3.49 is very high and demonstrates very strong liquidity.
  • STRAYER EDUCATION INC's earnings per share declined by 13.9% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, STRAYER EDUCATION INC increased its bottom line by earning $4.36 versus $1.51 in the prior year. For the next year, the market is expecting a contraction of 16.5% in earnings ($3.64 versus $4.36).
  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, STRA has underperformed the S&P 500 Index, declining 11.48% from its price level of one year ago. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.

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