Trade-Ideas LLC identified

Zillow Group

(

ZG

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

  • ZG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $19.1 million.
  • ZG has traded 89,266 shares today.
  • ZG is trading at 2.01 times the normal volume for the stock at this time of day.
  • ZG is trading at a new low 3.06% 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 ZG:

Zillow Group, Inc. operates real estate and home-related information marketplaces on mobile and the Web in the United States. It offers a portfolio of brands and products to help people find vital information about homes, and connect with local professionals. Currently there are 4 analysts that rate Zillow Group a buy, 2 analysts rate it a sell, and 8 rate it a hold.

The average volume for Zillow Group has been 3.7 million shares per day over the past 30 days. Zillow Group has a market cap of $1.5 billion and is part of the financial sector and real estate industry. The stock has a beta of 1.83 and a short float of 52.1% with 26.64 days to cover. Shares are down 12.9% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Zillow Group 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 also find weaknesses including deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • ZG's very impressive revenue growth greatly exceeded the industry average of 7.1%. Since the same quarter one year prior, revenues leaped by 117.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Although ZG's debt-to-equity ratio of 0.09 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 5.87, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for ZILLOW GROUP INC is currently very high, coming in at 91.98%. Regardless of ZG's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ZG's net profit margin of -22.60% significantly underperformed when compared to the industry average.
  • 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 Internet Software & Services industry. The net income has significantly decreased by 269.6% when compared to the same quarter one year ago, falling from -$10.48 million to -$38.72 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Internet Software & Services industry and the overall market, ZILLOW GROUP INC's return on equity significantly trails that of both the industry average and the S&P 500.

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