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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

Macrogenics

(

MGNX

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

  • MGNX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $13.1 million.
  • MGNX has traded 74,982 shares today.
  • MGNX is trading at 3.90 times the normal volume for the stock at this time of day.
  • MGNX is trading at a new low 4.35% 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 MGNX:

TheStreet Recommends

MacroGenics, Inc., a clinical-stage biopharmaceutical company, focuses on discovering and developing monoclonal antibody-based therapeutics for the treatment of cancer, as well as autoimmune disorders and infectious diseases. MGNX has a PE ratio of 255. Currently there are 6 analysts that rate Macrogenics a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Macrogenics has been 221,400 shares per day over the past 30 days. Macrogenics has a market cap of $1.1 billion and is part of the health care sector and drugs industry. Shares are up 8.3% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Macrogenics as a

hold

. 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 and expanding profit margins. However, as a counter to these strengths, we find that the growth in the company's earnings per share has not been good.

Highlights from the ratings report include:

  • MGNX's very impressive revenue growth greatly exceeded the industry average of 22.1%. Since the same quarter one year prior, revenues leaped by 384.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • MGNX has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 10.98, which clearly demonstrates the ability to cover short-term cash needs.
  • In comparison to the other companies in the Biotechnology industry and the overall market, MACROGENICS INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • Powered by its strong earnings growth of 1283.33% and other important driving factors, this stock has surged by 56.66% over the past year, outperforming the rise in the S&P 500 Index during the same period. Setting our sights on the months ahead, however, we feel that the stock's sharp appreciation over the last year has driven it to a price level which is now relatively expensive compared to the rest of its industry. The implication is that its reduced upside potential is not good enough to warrant further investment at this time.
  • MACROGENICS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, MACROGENICS INC swung to a loss, reporting -$1.38 versus $0.14 in the prior year. This year, the market expects an improvement in earnings (-$0.06 versus -$1.38).

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