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

  • APOL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $34.4 million.
  • APOL has traded 1.9 million shares today.
  • APOL is trading at 55.98 times the normal volume for the stock at this time of day.
  • APOL is trading at a new low 16.02% 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 APOL:

Apollo Education Group, Inc. provides private education services. It offers online and on-campus undergraduate, graduate, professional development, and other non-degree educational programs and services primarily to working learners in the United States and internationally. APOL has a PE ratio of 18. Currently there are no analysts that rate Apollo Education Group a buy, no analysts rate it a sell, and 8 rate it a hold.

The average volume for Apollo Education Group has been 1.7 million shares per day over the past 30 days. Apollo Education Group has a market cap of $1.8 billion and is part of the services sector and diversified services industry. The stock has a beta of 2.69 and a short float of 3.2% with 1.18 days to cover. Shares are down 52.1% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Apollo Education Group as a sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself, feeble growth in its earnings per share, deteriorating net income, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 47.72%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 306.66% compared to the year-earlier quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
  • APOLLO EDUCATION GROUP INC 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. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, APOLLO EDUCATION GROUP INC reported lower earnings of $1.92 versus $2.20 in the prior year. For the next year, the market is expecting a contraction of 43.8% in earnings ($1.08 versus $1.92).
  • 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 330.1% when compared to the same quarter one year ago, falling from $14.61 million to -$33.61 million.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. In comparison to the other companies in the Diversified Consumer Services industry and the overall market, APOLLO EDUCATION GROUP INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • Net operating cash flow has decreased to $36.81 million or 43.00% when compared to the same quarter last year. Despite a decrease in cash flow APOLLO EDUCATION GROUP INC is still fairing well by exceeding its industry average cash flow growth rate of -77.06%.

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