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

  • MMYT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $6.7 million.
  • MMYT has traded 68,672 shares today.
  • MMYT is trading at 8.64 times the normal volume for the stock at this time of day.
  • MMYT is trading at a new low 3.17% 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 MMYT:

MakeMyTrip Limited, an online travel company, provides travel products and solutions in India and internationally. Currently there are 6 analysts that rate MakeMyTrip a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for MakeMyTrip has been 222,700 shares per day over the past 30 days. MakeMyTrip has a market cap of $945.7 million and is part of the services sector and leisure industry. Shares are down 12.7% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates MakeMyTrip as a hold. 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 and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income and weak operating cash flow.

Highlights from the ratings report include:
  • MMYT's revenue growth trails the industry average of 19.4%. Since the same quarter one year prior, revenues slightly increased by 8.2%. 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.
  • MMYT's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • Net operating cash flow has decreased to $3.35 million or 32.67% 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 Internet & Catalog Retail industry. The net income has significantly decreased by 121.1% when compared to the same quarter one year ago, falling from -$1.63 million to -$3.61 million.

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