Tarena International (TEDU) Flagged As Strong On High Volume

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

  • TEDU has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.0 million.
  • TEDU has traded 285,948 shares today.
  • TEDU is trading at 13.53 times the normal volume for the stock at this time of day.
  • TEDU is trading at a new high 4.01% 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 TEDU:

Tarena International, Inc., through its subsidiaries, primarily provides information technology (IT) professional education services through part-time and full-time classes in the People's Republic of China. TEDU has a PE ratio of 25. Currently there are 3 analysts that rate Tarena International a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Tarena International has been 355,200 shares per day over the past 30 days. Tarena International has a market cap of $613.6 million and is part of the services sector and diversified services industry. Shares are up 12.4% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Tarena International as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. However, as a counter to these strengths, we find that the growth in the company's net income has been quite unimpressive.

Highlights from the ratings report include:
  • TEDU's revenue growth has slightly outpaced the industry average of 7.5%. Since the same quarter one year prior, revenues rose by 15.8%. 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.
  • TEDU has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 4.44, which clearly demonstrates the ability to cover short-term cash needs.
  • In comparison to the other companies in the Diversified Consumer Services industry and the overall market, TARENA INTL INC -ADR's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • TARENA INTL INC -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. This year, the market expects an improvement in earnings ($0.66 versus $0.44).
  • 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 Diversified Consumer Services industry. The net income has significantly decreased by 359.4% when compared to the same quarter one year ago, falling from $0.96 million to -$2.50 million.

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