Tuesday Morning (TUES) Highlighted As Weak 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 Tuesday Morning ( TUES) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Tuesday Morning as such a stock due to the following factors:

  • TUES has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.6 million.
  • TUES has traded 438,896 shares today.
  • TUES is trading at 23.83 times the normal volume for the stock at this time of day.
  • TUES is trading at a new low 8.04% 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 TUES:

Tuesday Morning Corporation operates as a retailer of upscale decorative home accessories, housewares, seasonal goods, and famous-maker gifts in the United States. TUES has a PE ratio of 92. Currently there is 1 analyst that rates Tuesday Morning a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Tuesday Morning has been 541,800 shares per day over the past 30 days. Tuesday Morning has a market cap of $606.7 million and is part of the services sector and retail industry. The stock has a beta of 2.31 and a short float of 29.3% with 23.50 days to cover. Shares are down 39.2% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Tuesday Morning as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and weak operating cash flow.

Highlights from the ratings report include:
  • TUES's revenue growth has slightly outpaced the industry average of 2.1%. Since the same quarter one year prior, revenues slightly increased by 3.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • TUESDAY MORNING CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, TUESDAY MORNING CORP continued to lose money by earning -$0.24 versus -$1.34 in the prior year. This year, the market expects an improvement in earnings ($0.32 versus -$0.24).
  • TUES 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. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.38 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • Net operating cash flow has decreased to -$8.74 million or 13.24% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • TUES has underperformed the S&P 500 Index, declining 23.91% from its price level of one year ago. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.

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