Today's Strong And Under The Radar Stock Is Mead Johnson Nutrition (MJN)

Trade-Ideas LLC identified Mead Johnson Nutrition (MJN) as a strong and under the radar candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Mead Johnson Nutrition

(

MJN

) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Mead Johnson Nutrition as such a stock due to the following factors:

  • MJN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $150.9 million.
  • MJN has traded 1440.579999999999927240423858165740966796875 options contracts today.
  • MJN is making at least a new 3-day high.
  • MJN has a PE ratio of 34.
  • MJN is mentioned 1.55 times per day on StockTwits.
  • MJN has not yet been mentioned on StockTwits today.
  • MJN is currently in the upper 20% of its 1-year range.
  • MJN is in the upper 35% of its 20-day range.
  • MJN is in the upper 45% of its 5-day range.
  • MJN is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

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More details on MJN:

Mead Johnson Nutrition Company manufactures, distributes, and sells infant formulas, children's nutrition, and other nutritional products. The stock currently has a dividend yield of 1.8%. MJN has a PE ratio of 34. Currently there are 3 analysts that rate Mead Johnson Nutrition a buy, 2 analysts rate it a sell, and 6 rate it a hold.

The average volume for Mead Johnson Nutrition has been 1.4 million shares per day over the past 30 days. Mead Johnson Nutrition has a market cap of $16.7 billion and is part of the consumer goods sector and food & beverage industry. The stock has a beta of 1.42 and a short float of 4.9% with 7.29 days to cover. Shares are up 14.7% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Mead Johnson Nutrition as a

hold

. Among the primary strengths of the company is its expanding profit margins over time. At the same time, however, we also find weaknesses including deteriorating net income, weak operating cash flow and feeble growth in the company's earnings per share.

Highlights from the ratings report include:

  • The gross profit margin for MEAD JOHNSON NUTRITION CO is rather high; currently it is at 66.46%. 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 7.55% trails the industry average.
  • MJN, with its decline in revenue, underperformed when compared the industry average of 16.8%. Since the same quarter one year prior, revenues fell by 12.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • After a year of stock price fluctuations, the net result is that MJN's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • 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 Food Products industry. The net income has significantly decreased by 64.9% when compared to the same quarter one year ago, falling from $207.40 million to $72.70 million.
  • Net operating cash flow has decreased to $160.10 million or 41.67% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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