Trade-Ideas: Celgene Corporation (CELG) Is Today's Momo Momentum Stock
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 or Stephanie Link.Trade-Ideas LLC identified Celgene Corporation (CELG) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Celgene Corporation as such a stock due to the following factors:
- CELG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $421.3 million.
- CELG has a PE ratio of 41.3.
- CELG is currently in the upper 30% of its 1-year range.
- CELG is in the upper 25% of its 20-day range.
- CELG is in the upper 35% of its 5-day range.
- CELG is currently trading above yesterday's high.
- CELG has experienced a gap between today's open and yesterday's close of 1.7%.
'Momo Momentum' stocks are valuable stocks to watch for a variety of reasons including historical back testing and price action. Market technicians refer to such stocks as being in a mark-up phase before a possible distribution period and price decline. Technical analysts and traders frequently find that the factors referenced above tend to create a temporary burst of strong wind in a stock's sail. Nevertheless, all successful traders must excel at maximizing gains while keeping losses to an absolute minimum. For that reason, the holding period on momo momentum stocks must always be a primary consideration, and this part of the puzzle is ultimately at the discretion of each individual's risk tolerance and portfolio risk management skills.EXCLUSIVE OFFER: Get the inside scoop on opportunities in CELG with the Ticky from Trade-Ideas. See the FREE profile for CELG NOW at Trade-IdeasMore details on CELG: Celgene Corporation, a biopharmaceutical company, discovers, develops, and commercializes therapies for cancer and immune-inflammatory related diseases in the United States and Europe. CELG has a PE ratio of 41.3. Currently there are 23 analysts that rate Celgene Corporation a buy, no analysts rate it a sell, and 2 rate it a hold.The average volume for Celgene Corporation has been 3.0 million shares per day over the past 30 days. Celgene has a market cap of $56.7 billion and is part of the health care sector and drugs industry. The stock has a beta of 0.80 and a short float of 1.1% with 1.65 days to cover. Shares are up 73.3% year to date as of the close of trading on Thursday.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.TheStreetRatings.com Analysis:TheStreet Quant Ratings rates Celgene Corporation as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, expanding profit margins and good cash flow from operations. We feel these strengths outweigh the fact that the company has had sub par growth in net income.Highlights from the ratings report include:
- CELG's revenue growth has slightly outpaced the industry average of 12.5%. Since the same quarter one year prior, revenues rose by 15.0%. 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.
- The current debt-to-equity ratio, 0.56, is low and is below the industry average, implying that there has been successful management of debt levels. Along with this, the company maintains a quick ratio of 2.89, which clearly demonstrates the ability to cover short-term cash needs.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. When compared to other companies in the Biotechnology industry and the overall market, CELGENE CORP's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
- CELGENE CORP' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CELGENE CORP increased its bottom line by earning $3.30 versus $2.85 in the prior year. This year, the market expects an improvement in earnings ($5.75 versus $3.30).
- The gross profit margin for CELGENE CORP is currently very high, coming in at 96.22%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 26.28% trails the industry average.
- You can view the full Celgene Corporation Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
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