Maiden Holdings (MHLD) Weak On High Volume Today

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

  • MHLD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $3.2 million.
  • MHLD has traded 131,302 shares today.
  • MHLD is trading at 8.83 times the normal volume for the stock at this time of day.
  • MHLD is trading at a new low 8.46% 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 MHLD:

Maiden Holdings, Ltd., together with its subsidiaries, provides reinsurance solutions to regional and specialty insurers in the United States, Europe, and internationally. The company operates in two segments, Diversified Reinsurance and AmTrust Reinsurance. The stock currently has a dividend yield of 3.5%. MHLD has a PE ratio of 14.1. Currently there are 3 analysts that rate Maiden Holdings a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Maiden Holdings has been 320,900 shares per day over the past 30 days. Maiden has a market cap of $1.1 billion and is part of the financial sector and insurance industry. The stock has a beta of 0.75 and a short float of 6.6% with 23.84 days to cover. Shares are up 14.9% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Maiden Holdings as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations, solid stock price performance and increase in net income. 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 2.7%. Since the same quarter one year prior, revenues rose by 23.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Although MHLD's debt-to-equity ratio of 0.29 is very low, it is currently higher than that of the industry average.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Insurance industry. The net income increased by 27.5% when compared to the same quarter one year prior, rising from $26.36 million to $33.60 million.
  • Net operating cash flow has significantly increased by 1989.39% to $144.61 million when compared to the same quarter last year. In addition, MAIDEN HOLDINGS LTD has also vastly surpassed the industry average cash flow growth rate of 2.93%.

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