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

UTi Worldwide

(

UTIW

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

  • UTIW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $17.9 million.
  • UTIW has traded 711,159 shares today.
  • UTIW is trading at 7.83 times the normal volume for the stock at this time of day.
  • UTIW is trading at a new low 4.01% 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 UTIW:

UTi Worldwide Inc., through its subsidiaries, provides non-asset-based supply chain services and solutions worldwide. It operates in two segments, Freight Forwarding, and Contract Logistics and Distribution. Currently there is 1 analyst that rates UTi Worldwide a buy, no analysts rate it a sell, and 7 rate it a hold.

The average volume for UTi Worldwide has been 792,000 shares per day over the past 30 days. UTi Worldwide has a market cap of $1.3 billion and is part of the services sector and transportation industry. The stock has a beta of 0.16 and a short float of 18.9% with 9.25 days to cover. Shares are down 17.3% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates UTi Worldwide as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we find that the growth in the company's net income has been quite unimpressive.

Highlights from the ratings report include:

  • The debt-to-equity ratio is somewhat low, currently at 0.66, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.48, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has significantly increased by 187.79% to $19.49 million when compared to the same quarter last year. In addition, UTI WORLDWIDE INC has also vastly surpassed the industry average cash flow growth rate of -13.37%.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • 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 Air Freight & Logistics industry and the overall market, UTI WORLDWIDE INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • 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 Air Freight & Logistics industry. The net income has significantly decreased by 274.6% when compared to the same quarter one year ago, falling from -$9.08 million to -$34.00 million.

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