Medicines Company (MDCO) Marked As A Barbarian At The Gate
Trade-Ideas LLC identified
(
) 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 Medicines Company as such a stock due to the following factors:
- MDCO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $61.1 million.
- MDCO has traded 728,919 shares today.
- MDCO traded in a range 213% of the normal price range with a price range of $4.37.
- MDCO traded above its daily resistance level (quality: 50 days, meaning that the stock is crossing a resistance level set by the last 50 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.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in MDCO with the Ticky from Trade-Ideas. See the FREE profile for MDCO NOW at Trade-Ideas
More details on MDCO:
The Medicines Company provides medicines for patients in acute and intensive care hospitals worldwide. Currently there are 6 analysts that rate Medicines Company a buy, no analysts rate it a sell, and 2 rate it a hold.
The average volume for Medicines Company has been 1.9 million shares per day over the past 30 days. Medicines has a market cap of $2.7 billion and is part of the health care sector and drugs industry. The stock has a beta of 0.08 and a short float of 30.7% with 10.50 days to cover. Shares are up 39.1% year-to-date as of the close of trading on Thursday.
EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.
Analysis:
rates Medicines Company as a
. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.
Highlights from the ratings report include:
- Compared to its closing price of one year ago, MDCO's share price has jumped by 62.31%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- The debt-to-equity ratio is somewhat low, currently at 0.62, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
- MDCO, with its very weak revenue results, has greatly underperformed against the industry average of 7.1%. Since the same quarter one year prior, revenues plummeted by 57.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- MEDICINES CO has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, MEDICINES CO swung to a loss, reporting -$0.50 versus $0.23 in the prior year. For the next year, the market is expecting a contraction of 636.0% in earnings (-$3.68 versus -$0.50).
- 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 528.2% when compared to the same quarter one year ago, falling from -$16.74 million to -$105.13 million.
- You can view the full Medicines Company Ratings Report.
EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.