Trade-Ideas: Weibo (WB) Is Today's Strong On High Relative Volume Stock - TheStreet

Trade-Ideas LLC identified

Weibo

(

WB

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

  • WB has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $11.7 million.
  • WB has traded 135,467 shares today.
  • WB is trading at 4.67 times the normal volume for the stock at this time of day.
  • WB is trading at a new high 3.03% 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.

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More details on WB:

Weibo Corporation operates as a social media platform for people to create, distribute, and discover Chinese-language content. The company operates through two segments, Advertising and Marketing Services, and Other Services. WB has a PE ratio of 41. Currently there is 1 analyst that rates Weibo a buy, 1 analyst rates it a sell, and none rate it a hold.

The average volume for Weibo has been 481,500 shares per day over the past 30 days. Weibo has a market cap of $3.7 billion and is part of the technology sector and internet industry. Shares are up 25.3% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Weibo 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 impressive record of earnings per share growth. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 15.1%. Since the same quarter one year prior, revenues rose by 48.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • WB 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 2.54, which clearly demonstrates the ability to cover short-term cash needs.
  • When compared to other companies in the Internet Software & Services industry and the overall market, WEIBO CORP -ADR's return on equity is below that of both the industry average and the S&P 500.
  • The gross profit margin for WEIBO CORP -ADR is currently very high, coming in at 74.20%. Regardless of WB'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 11.60% trails the industry average.
  • After a year of stock price fluctuations, the net result is that WB's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. This company's share value has not moved any higher or lower than its level twelve months ago.

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