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

  • CMLS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.1 million.
  • CMLS has traded 116,092 shares today.
  • CMLS is trading at 2.14 times the normal volume for the stock at this time of day.
  • CMLS 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 CMLS:

Cumulus Media Inc. owns and operates radio stations in the United States. It sells commercial advertising time to local, national, and network clients on its radio stations. CMLS has a PE ratio of 59.6. Currently there are 4 analysts that rate Cumulus Media a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Cumulus Media has been 1.3 million shares per day over the past 30 days. Cumulus Media has a market cap of $693.3 million and is part of the services sector and media industry. The stock has a beta of 2.84 and a short float of 9.9% with 4.03 days to cover. Shares are down 29.6% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Cumulus Media as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, reasonable valuation levels and notable return on equity. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and weak operating cash flow.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 7.7%. Since the same quarter one year prior, revenues rose by 19.6%. 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.
  • Net operating cash flow has decreased to $56.58 million or 20.18% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • 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 Media industry. The net income has significantly decreased by 63.9% when compared to the same quarter one year ago, falling from $7.04 million to $2.54 million.

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