Barbarian At The Gate: Mylan (MYL)

Trade-Ideas LLC identified Mylan (MYL) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Mylan

(

MYL

) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Mylan as such a stock due to the following factors:

  • MYL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $142.4 million.
  • MYL has traded 3.7 million shares today.
  • MYL traded in a range 209.1% of the normal price range with a price range of $2.02.
  • MYL traded above its daily resistance level (quality: 88 days, meaning that the stock is crossing a resistance level set by the last 88 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' 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 positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on MYL:

Mylan N.V., together with its subsidiaries, develops, licenses, manufactures, markets, and distributes generic, branded generic, and specialty pharmaceuticals worldwide. MYL has a PE ratio of 28. Currently there are 5 analysts that rate Mylan a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Mylan has been 5.1 million shares per day over the past 30 days. Mylan has a market cap of $23.1 billion and is part of the health care sector and drugs industry. The stock has a beta of 1.32 and a short float of 6% with 8.91 days to cover. Shares are down 16.9% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Mylan as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:

  • MYL's revenue growth has slightly outpaced the industry average of 8.4%. Since the same quarter one year prior, revenues rose by 17.1%. 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 debt-to-equity ratio is somewhat low, currently at 0.73, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.98 is somewhat weak and could be cause for future problems.
  • 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 Pharmaceuticals industry. The net income has significantly decreased by 75.4% when compared to the same quarter one year ago, falling from $56.60 million to $13.90 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Pharmaceuticals industry and the overall market, MYLAN NV's return on equity is below that of both the industry average and the S&P 500.

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