Houghton Mifflin Harcourt Company (HMHC) Is Today's Pre-Market Mover With Heavy 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 Houghton Mifflin Harcourt Company ( HMHC) as a pre-market mover with heavy volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Houghton Mifflin Harcourt Company as such a stock due to the following factors:

  • HMHC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $18.0 million.
  • HMHC traded 95,400 shares today in the pre-market hours as of 8:01 AM, representing 12.4% of its average daily volume.

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More details on HMHC:

Houghton Mifflin Harcourt Company provides education solutions for educational institutions and consumers worldwide. It delivers content, technology, and services to approximately 50 million students. The company operates in two segments, Education and Trade Publishing. Currently there are no analysts that rate Houghton Mifflin Harcourt Company a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Houghton Mifflin Harcourt Company has been 728,300 shares per day over the past 30 days. Houghton Mifflin Harcourt has a market cap of $3.4 billion and is part of the services sector and diversified services industry. Shares are up 16.1% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Houghton Mifflin Harcourt Company as a sell. Among the areas we feel are negative, one of the most important has been the company's poor growth in earnings per share.

Highlights from the ratings report include:
  • HOUGHTON MIFFLIN HARCOURT CO's earnings per share declined by 7.6% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, HOUGHTON MIFFLIN HARCOURT CO reported poor results of -$0.81 versus -$0.79 in the prior year. This year, the market expects an improvement in earnings (-$0.34 versus -$0.81).
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Diversified Consumer Services industry average. The net income has decreased by 9.3% when compared to the same quarter one year ago, dropping from -$146.34 million to -$159.94 million.
  • Looking at where the stock is today compared to one year ago, we find that it is higher, and it has outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 7.3%. Since the same quarter one year prior, revenues slightly increased by 5.7%. 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.

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