Bazaarvoice (BV) Strong On High Relative 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 Bazaarvoice ( BV) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Bazaarvoice as such a stock due to the following factors:

  • BV has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.4 million.
  • BV has traded 197,521 shares today.
  • BV is trading at 4.07 times the normal volume for the stock at this time of day.
  • BV is trading at a new high 3.32% 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 BV:

Bazaarvoice, Inc. operates as a network that connects brands and retailers to the voices of people where they shop. Currently there are 3 analysts that rate Bazaarvoice a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Bazaarvoice has been 518,500 shares per day over the past 30 days. Bazaarvoice has a market cap of $467.4 million and is part of the technology sector and computer software & services industry. The stock has a beta of 0.70 and a short float of 8.6% with 4.74 days to cover. Shares are down 25% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Bazaarvoice as a sell. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • BV has underperformed the S&P 500 Index, declining 20.55% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Internet Software & Services industry and the overall market, BAZAARVOICE INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for BAZAARVOICE INC is rather high; currently it is at 68.60%. Regardless of BV's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, BV's net profit margin of -18.26% significantly underperformed when compared to the industry average.
  • Net operating cash flow has significantly increased by 213.13% to $3.07 million when compared to the same quarter last year. In addition, BAZAARVOICE INC has also vastly surpassed the industry average cash flow growth rate of 41.44%.
  • Although BV's debt-to-equity ratio of 0.30 is very low, it is currently higher than that of the industry average. To add to this, BV has a quick ratio of 1.71, which demonstrates the ability of the company to cover short-term liquidity needs.

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