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 strong 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 $4.4 million.
  • CMLS has traded 279,677 shares today.
  • CMLS is trading at 6.86 times the normal volume for the stock at this time of day.
  • CMLS is trading at a new high 4.12% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into 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. 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 59.0. 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 $686.3 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 7.43 days to cover. Shares are down 42.5% year-to-date as of the close of trading on Thursday.

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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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