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 Energy Company of Parana ( ELP) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Energy Company of Parana as such a stock due to the following factors:

  • ELP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $6.6 million.
  • ELP has traded 135,448 shares today.
  • ELP is trading at 2.95 times the normal volume for the stock at this time of day.
  • ELP is trading at a new high 3.05% 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 ELP:

Companhia Paranaense de Energia - COPEL is engaged in the generation, transmission, distribution, and sale of electricity to industrial, residential, commercial, and rural customers primarily in the State of Parana, Brazil. The stock currently has a dividend yield of 8.7%. Currently there is 1 analyst that rates Energy Company of Parana a buy, 1 analyst rates it a sell, and 1 rates it a hold.

The average volume for Energy Company of Parana has been 633,100 shares per day over the past 30 days. Energy Company of Parana has a market cap of $2.9 billion and is part of the utilities sector and utilities industry. Shares are down 20.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Energy Company of Parana as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth and increase in net income. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and feeble growth in the company's earnings per share.

Highlights from the ratings report include:
  • ELP's very impressive revenue growth greatly exceeded the industry average of 10.5%. Since the same quarter one year prior, revenues leaped by 61.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Electric Utilities industry average. The net income increased by 17.9% when compared to the same quarter one year prior, going from $49.47 million to $58.31 million.
  • COPEL-CIA PARANAENSE ENERGIA has improved earnings per share by 18.4% in the most recent quarter compared to the same quarter a year ago. Stable earnings per share over the past year indicate the company has managed its earnings and share float. We anticipate this stability to falter in the coming year and, in turn, the company to deliver lower earnings per share than prior full year. During the past fiscal year, COPEL-CIA PARANAENSE ENERGIA's EPS of $3.53 remained unchanged from the prior years' EPS of $3.53. For the next year, the market is expecting a contraction of 45.8% in earnings ($1.91 versus $3.53).
  • ELP has underperformed the S&P 500 Index, declining 17.33% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.

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