Trade-Ideas LLC identified

WisdomTree Investments

(

WETF

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified WisdomTree Investments as such a stock due to the following factors:

  • WETF has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $71.6 million.
  • WETF has traded 114,257 shares today.
  • WETF is down 3.2% today.
  • WETF was up 9% yesterday.

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More details on WETF:

WisdomTree Investments, Inc., through its subsidiaries, operates as an exchange-traded funds (ETFs) sponsor and asset manager. It offers ETFs in equities, currency, fixed income, and alternatives asset classes. The stock currently has a dividend yield of 1.7%. WETF has a PE ratio of 45. Currently there are 4 analysts that rate WisdomTree Investments a buy, no analysts rate it a sell, and 2 rate it a hold.

TheStreet Recommends

The average volume for WisdomTree Investments has been 3.2 million shares per day over the past 30 days. WisdomTree Investments has a market cap of $2.6 billion and is part of the financial sector and financial services industry. The stock has a beta of 3.21 and a short float of 9.6% with 2.90 days to cover. Shares are up 14.4% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates WisdomTree Investments as a

buy

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, growth in earnings per share, increase in net income, expanding profit margins and good cash flow from operations. We feel its strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value.

Highlights from the ratings report include:

  • WETF's very impressive revenue growth greatly exceeded the industry average of 6.9%. Since the same quarter one year prior, revenues leaped by 84.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • WISDOMTREE INVESTMENTS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, WISDOMTREE INVESTMENTS INC increased its bottom line by earning $0.45 versus $0.38 in the prior year. This year, the market expects an improvement in earnings ($0.67 versus $0.45).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 128.0% when compared to the same quarter one year prior, rising from $10.60 million to $24.17 million.
  • The gross profit margin for WISDOMTREE INVESTMENTS INC is rather high; currently it is at 50.79%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 29.63% significantly outperformed against the industry average.
  • Net operating cash flow has significantly increased by 109.22% to $48.60 million when compared to the same quarter last year. In addition, WISDOMTREE INVESTMENTS INC has also vastly surpassed the industry average cash flow growth rate of -433.20%.

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