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

Xcerra

(

XCRA

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

  • XCRA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.9 million.
  • XCRA has traded 61,642 shares today.
  • XCRA is trading at 3.09 times the normal volume for the stock at this time of day.
  • XCRA is trading at a new low 4.05% 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.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in XCRA with the Ticky from Trade-Ideas. See the FREE profile for XCRA NOW at Trade-Ideas

More details on XCRA:

Xcerra Corporation designs, manufactures, markets, and services automated test equipment for the mobility, industrial, medical, automotive, and consumer end markets. It operates through two segments, Semiconductor Test Solutions and Electronic Manufacturing Solutions. XCRA has a PE ratio of 19. Currently there are 4 analysts that rate Xcerra a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Xcerra has been 331,600 shares per day over the past 30 days. Xcerra has a market cap of $525.3 million and is part of the technology sector and electronics industry. The stock has a beta of 1.11 and a short float of 1.9% with 3.23 days to cover. Shares are up 5.1% year-to-date as of the close of trading on Friday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Xcerra as a

buy

. 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, impressive record of earnings per share growth, compelling growth in net income and reasonable valuation levels. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 0.5%. Since the same quarter one year prior, revenues rose by 35.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • XCRA's debt-to-equity ratio is very low at 0.10 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.13, which clearly demonstrates the ability to cover short-term cash needs.
  • XCERRA CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, XCERRA CORP turned its bottom line around by earning $0.10 versus -$0.26 in the prior year. This year, the market expects an improvement in earnings ($0.65 versus $0.10).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 344.9% when compared to the same quarter one year prior, rising from -$1.60 million to $3.93 million.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.