8x8 (EGHT) Trading With Heavy Volume Before Market Open

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 or Stephanie Link.

Trade-Ideas LLC identified 8x8 ( EGHT) as a pre-market mover with heavy volume candidate. In addition to specific proprietary factors, Trade-Ideas identified 8x8 as such a stock due to the following factors:

  • EGHT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $8.6 million.
  • EGHT traded 130,000 shares today in the pre-market hours as of 8:29 AM, representing 14.7% of its average daily volume.

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More details on EGHT:

8x8, Inc. develops and markets telecommunications services for Internet protocol (IP), telephony, and video applications. The company also provides contact center, Web-based conferencing, and unified communications services, as well as cloud-based computing services. EGHT has a PE ratio of 98.6. Currently there are 5 analysts that rate 8x8 a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for 8x8 has been 723,200 shares per day over the past 30 days. 8X8 has a market cap of $721.4 million and is part of the technology sector and telecommunications industry. The stock has a beta of 0.17 and a short float of 5.9% with 4.36 days to cover. Shares are up 33.6% year to date as of the close of trading on Tuesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates 8x8 as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in net income, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 2.8%. Since the same quarter one year prior, revenues rose by 21.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Diversified Telecommunication Services industry average. The net income increased by 28.1% when compared to the same quarter one year prior, rising from $1.74 million to $2.23 million.
  • The gross profit margin for 8X8 INC is currently very high, coming in at 74.00%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 7.23% trails the industry average.
  • Compared to its closing price of one year ago, EGHT's share price has jumped by 58.77%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • 8X8 INC reported flat earnings per share in the most recent quarter. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, 8X8 INC reported lower earnings of $0.19 versus $0.95 in the prior year. This year, the market expects an improvement in earnings ($0.20 versus $0.19).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.