Trade-Ideas: BGC Partners (BGCP) Is Today's Strong On High Relative Volume Stock - TheStreet

Trade-Ideas LLC identified

BGC Partners

(

BGCP

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

  • BGCP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $8.6 million.
  • BGCP has traded 172,726 shares today.
  • BGCP is trading at 4.80 times the normal volume for the stock at this time of day.
  • BGCP is trading at a new high 4.04% 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.

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

More details on BGCP:

BGC Partners, Inc. operates as a brokerage company in the United Kingdom, the United States, and internationally. It operates in two segments, Financial Services and Real Estate Services. The stock currently has a dividend yield of 6.6%. BGCP has a PE ratio of 17. Currently there is 1 analyst that rates BGC Partners a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for BGC Partners has been 1.2 million shares per day over the past 30 days. BGC has a market cap of $1.8 billion and is part of the financial sector and financial services industry. The stock has a beta of 1.61 and a short float of 3% with 5.04 days to cover. Shares are down 8% year-to-date as of the close of trading on Tuesday.

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 BGC Partners as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and increase in net income. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and poor profit margins.

Highlights from the ratings report include:

  • BGCP's very impressive revenue growth greatly exceeded the industry average of 5.1%. Since the same quarter one year prior, revenues leaped by 60.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 23.0% when compared to the same quarter one year prior, going from $7.60 million to $9.35 million.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry, implying reduced upside potential.
  • The gross profit margin for BGC PARTNERS INC is currently extremely low, coming in at 8.42%. Regardless of BGCP's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, BGCP's net profit margin of 1.39% is significantly lower than the industry average.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Capital Markets industry and the overall market on the basis of return on equity, BGC PARTNERS INC underperformed against that of the industry average and is significantly less than that of the S&P 500.

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.