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

  • QUNR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $66.7 million.
  • QUNR has traded 936,245 shares today.
  • QUNR is trading at 16.99 times the normal volume for the stock at this time of day.
  • QUNR is trading at a new low 9.02% 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 QUNR:

Qunar Cayman Islands Limited operates an online travel commerce platform in the People's Republic of China. Currently there are 3 analysts that rate Qunar Cayman Islands a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Qunar Cayman Islands has been 1.1 million shares per day over the past 30 days. Qunar Cayman Islands has a market cap of $6.0 billion and is part of the services sector and leisure industry. Shares are up 86% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Qunar Cayman Islands as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income and feeble growth in its earnings per share.

Highlights from the ratings report include:
  • 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 434.3% when compared to the same quarter one year ago, falling from -$20.20 million to -$107.92 million.
  • QUNAR CAYMAN ISLANDS -ADR 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 year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, QUNAR CAYMAN ISLANDS -ADR reported poor results of -$2.53 versus -$0.24 in the prior year. This year, the market expects an improvement in earnings (-$1.38 versus -$2.53).
  • The gross profit margin for QUNAR CAYMAN ISLANDS -ADR is currently very high, coming in at 77.27%. Regardless of QUNR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, QUNR's net profit margin of -130.04% significantly underperformed when compared to the industry average.
  • Compared to its closing price of one year ago, QUNR's share price has jumped by 104.58%, exceeding the performance of the broader market during that same time frame. Regarding the future course of this stock, we feel that the risks involved in investing in QUNR do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
  • QUNR's very impressive revenue growth greatly exceeded the industry average of 19.1%. Since the same quarter one year prior, revenues leaped by 95.1%. 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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