Trade-Ideas LLC identified

InvenSense

(

INVN

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

  • INVN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $8.2 million.
  • INVN has traded 122,143 shares today.
  • INVN is trading at 2.55 times the normal volume for the stock at this time of day.
  • INVN 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.

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More details on INVN:

InvenSense, Inc. designs, develops, markets, and sells micro-electro-mechanical system (MEMS) gyroscopes for motion tracking devices in consumer electronics. INVN has a PE ratio of 241. Currently there are 2 analysts that rate InvenSense a buy, no analysts rate it a sell, and 7 rate it a hold.

The average volume for InvenSense has been 1.1 million shares per day over the past 30 days. InvenSense has a market cap of $667.2 million and is part of the technology sector and electronics industry. The stock has a beta of 2.23 and a short float of 14.3% with 9.87 days to cover. Shares are down 27.6% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates InvenSense as a

sell

. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself, unimpressive growth in net income and feeble growth in its earnings per share.

Highlights from the ratings report include:

  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 52.75%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 81.81% compared to the year-earlier quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
  • 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 Electronic Equipment, Instruments & Components industry. The net income has significantly decreased by 81.5% when compared to the same quarter one year ago, falling from $10.22 million to $1.89 million.
  • INVENSENSE INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, INVENSENSE INC swung to a loss, reporting -$0.02 versus $0.07 in the prior year. This year, the market expects an improvement in earnings ($0.48 versus -$0.02).
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, INVENSENSE INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • 46.15% is the gross profit margin for INVENSENSE INC which we consider to be strong. Regardless of INVN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 1.57% trails the industry average.

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