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

  • GLUU has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $10.3 million.
  • GLUU has traded 1.5 million shares today.
  • GLUU is trading at 11.22 times the normal volume for the stock at this time of day.
  • GLUU is trading at a new low 14.11% 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 GLUU:

Glu Mobile Inc. develops, publishes, and markets a portfolio of games for the smartphones and tablet devices users. The company offers free-to-play action, casual, racing, and sports genre mobile games. GLUU has a PE ratio of 64. Currently there are 6 analysts that rate Glu Mobile a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Glu Mobile has been 2.3 million shares per day over the past 30 days. Glu Mobile has a market cap of $695.5 million and is part of the technology sector and computer software & services industry. The stock has a beta of 3.69 and a short float of 14.7% with 7.26 days to cover. Shares are up 45.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Glu Mobile 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 compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • GLUU's very impressive revenue growth greatly exceeded the industry average of 11.4%. Since the same quarter one year prior, revenues leaped by 55.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • GLUU 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 the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.33, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for GLU MOBILE INC is rather high; currently it is at 63.14%. Regardless of GLUU's high profit margin, it has managed to decrease from the same period last year.
  • This stock's share value has moved by only 14.21% over the past year. 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.
  • Net operating cash flow has significantly decreased to -$5.11 million or 234.73% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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