Trade-Ideas: B2Gold (BTG) Is Today's Strong On High Relative Volume Stock

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 B2Gold ( BTG) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified B2Gold as such a stock due to the following factors:

  • BTG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.8 million.
  • BTG has traded 735,932 shares today.
  • BTG is trading at 9.97 times the normal volume for the stock at this time of day.
  • BTG is trading at a new high 5.30% 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 BTG:

B2Gold Corp., a mid-tier gold mining company, explores and develops mineral properties in Nicaragua, the Philippines, Namibia, Burkina Faso, and Chile. The company principally explores for gold, silver, and copper. Currently there are 5 analysts that rate B2Gold a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for B2Gold has been 2.0 million shares per day over the past 30 days. B2Gold has a market cap of $1.5 billion and is part of the basic materials sector and metals & mining industry. Shares are down 1.9% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates B2Gold as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • B2GOLD CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, B2GOLD CORP swung to a loss, reporting -$0.84 versus $0.07 in the prior year.
  • 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 Metals & Mining industry. The net income has significantly decreased by 1456.3% when compared to the same quarter one year ago, falling from $26.22 million to -$355.63 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Metals & Mining industry and the overall market, B2GOLD CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 44.41%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 2050.00% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 18.2%. Since the same quarter one year prior, revenues fell by 11.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

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