Eli Lilly And (LLY) Showing Signs Of Being A Momo Momentum Stock

Trade-Ideas LLC identified Eli Lilly and (LLY) as a momo momentum candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Eli Lilly and

(

LLY

) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Eli Lilly and as such a stock due to the following factors:

  • LLY has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $319.2 million.
  • LLY has a PE ratio of 38.
  • LLY is currently in the upper 30% of its 1-year range.
  • LLY is in the upper 25% of its 20-day range.
  • LLY is in the upper 35% of its 5-day range.
  • LLY is currently trading above yesterday's high.
  • LLY has experienced a gap between today's open and yesterday's close of 0.7%.

'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.

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More details on LLY:

Eli Lilly and Company discovers, develops, manufactures, and sells pharmaceutical products worldwide. It operates through two segments, Human Pharmaceutical Products and Animal Health Products. The stock currently has a dividend yield of 2.4%. LLY has a PE ratio of 38. Currently there are 7 analysts that rate Eli Lilly and a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Eli Lilly and has been 5.7 million shares per day over the past 30 days. Eli Lilly and has a market cap of $92.7 billion and is part of the health care sector and drugs industry. The stock has a beta of 0.20 and a short float of 1.2% with 3.08 days to cover. Shares are up 21.4% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Eli Lilly and 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, increase in net income, expanding profit margins and notable return on equity. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:

  • LLY's revenue growth has slightly outpaced the industry average of 3.7%. Since the same quarter one year prior, revenues slightly increased by 1.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.53, 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 1.01, which illustrates the ability to avoid short-term cash problems.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Pharmaceuticals industry average. The net income increased by 59.7% when compared to the same quarter one year prior, rising from $500.60 million to $799.70 million.
  • The gross profit margin for LILLY (ELI) & CO is currently very high, coming in at 82.71%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, LLY's net profit margin of 16.12% significantly trails the industry average.
  • 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. Compared to other companies in the Pharmaceuticals industry and the overall market on the basis of return on equity, LILLY (ELI) & CO has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

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