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

Apollo Education Group

(

APOL

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

  • APOL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $16.1 million.
  • APOL has traded 1.7 million shares today.
  • APOL is trading at 75.41 times the normal volume for the stock at this time of day.
  • APOL is trading at a new low 22.01% 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 APOL:

Apollo Education Group, Inc. provides private education services. It offers online and on-campus undergraduate, graduate, professional development, and other non-degree educational programs and services primarily to working learners in the United States and internationally. APOL has a PE ratio of 20.6. Currently there are 2 analysts that rate Apollo Education Group a buy, no analysts rate it a sell, and 8 rate it a hold.

The average volume for Apollo Education Group has been 1.2 million shares per day over the past 30 days. Apollo Education Group has a market cap of $3.0 billion and is part of the services sector and diversified services industry. The stock has a beta of 2.01 and a short float of 9.7% with 12.89 days to cover. Shares are down 17.9% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Apollo Education Group 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, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income.

Highlights from the ratings report include:

  • APOL's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.46, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for APOLLO EDUCATION GROUP INC is rather high; currently it is at 54.90%. Regardless of APOL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, APOL's net profit margin of 4.69% is significantly lower than the industry average.
  • APOLLO EDUCATION GROUP 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. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, APOLLO EDUCATION GROUP INC reported lower earnings of $1.92 versus $2.20 in the prior year. For the next year, the market is expecting a contraction of 28.1% in earnings ($1.38 versus $1.92).
  • 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 Diversified Consumer Services industry. The net income has significantly decreased by 65.8% when compared to the same quarter one year ago, falling from $98.89 million to $33.79 million.

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