Trade-Ideas: Life Technologies (LIFE) Is Today's "Water-Logged And Getting Wetter" 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 Life Technologies (LIFE) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Life Technologies as such a stock due to the following factors:
- LIFE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $123.2 million.
- LIFE has traded 1.9 million shares today.
- LIFE traded in a range 201.5% of the normal price range with a price range of $0.28.
- LIFE traded below its daily resistance level (quality: 32 days, meaning that the stock is crossing a resistance level set by the last 32 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).
Stocks matching the 'Water-Logged and Getting Wetter' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.EXCLUSIVE OFFER: Get the inside scoop on opportunities in LIFE with the Ticky from Trade-Ideas. See the FREE profile for LIFE NOW at Trade-IdeasMore details on LIFE: Life Technologies Corporation operates as a life sciences company. LIFE has a PE ratio of 30.9. Currently there are no analysts that rate Life Technologies a buy, no analysts rate it a sell, and 12 rate it a hold.The average volume for Life Technologies has been 1.7 million shares per day over the past 30 days. Life has a market cap of $12.9 billion and is part of the health care sector and health services industry. The stock has a beta of 1.56 and a short float of 1.1% with 1.15 days to cover. Shares are up 52.7% year to date as of the close of trading on Friday.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 Life Technologies as a buy. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.Highlights from the ratings report include:
- LIFE TECHNOLOGIES CORP has improved earnings per share by 7.5% 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 two years. We feel that this trend should continue. During the past fiscal year, LIFE TECHNOLOGIES CORP increased its bottom line by earning $2.39 versus $2.05 in the prior year. This year, the market expects an improvement in earnings ($4.18 versus $2.39).
- The current debt-to-equity ratio, 0.46, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.03, which illustrates the ability to avoid short-term cash problems.
- The gross profit margin for LIFE TECHNOLOGIES CORP is rather high; currently it is at 69.85%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 13.42% is above that of the industry average.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 51.77% over the past year, a rise that has exceeded that of the S&P 500 Index. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- You can view the full Life Technologies 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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