Trade-Ideas LLC identified

Endurance International Group Holdings

(

EIGI

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

  • EIGI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.9 million.
  • EIGI has traded 88,536 shares today.
  • EIGI is trading at 5.13 times the normal volume for the stock at this time of day.
  • EIGI is trading at a new low 5.03% 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 EIGI:

Endurance International Group Holdings, Inc., together with its subsidiaries, provides cloud-based platform solutions for small-and medium-sized businesses worldwide. Currently there are 4 analysts that rate Endurance International Group Holdings a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Endurance International Group Holdings has been 561,900 shares per day over the past 30 days. Endurance International Group has a market cap of $1.4 billion and is part of the technology sector and computer software & services industry. Shares are down 9.1% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Endurance International Group Holdings as a

sell

. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, generally high debt management risk and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Internet Software & Services industry. The net income has significantly decreased by 318.9% when compared to the same quarter one year ago, falling from -$2.20 million to -$9.23 million.
  • The debt-to-equity ratio is very high at 6.16 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.09, which clearly demonstrates the inability to cover short-term cash needs.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 46.62%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 250.00% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • 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 Internet Software & Services industry and the overall market, ENDURANCE INTL GRP HLDGS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for ENDURANCE INTL GRP HLDGS INC is rather high; currently it is at 62.84%. Regardless of EIGI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, EIGI's net profit margin of -4.78% significantly underperformed when compared to the industry average.

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