Trade-Ideas LLC identified

Cirrus Logic

(

CRUS

) 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 Cirrus Logic as such a stock due to the following factors:

  • CRUS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $39.6 million.
  • CRUS has traded 803,887 shares today.
  • CRUS traded in a range 249.2% of the normal price range with a price range of $2.70.
  • CRUS traded above its daily resistance level (quality: 9 days, meaning that the stock is crossing a resistance level set by the last 9 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 CRUS:

Cirrus Logic, Inc., a fabless semiconductor company, develops analog and mixed-signal integrated circuits for a range of consumer and industrial markets. CRUS has a PE ratio of 9. Currently there are 4 analysts that rate Cirrus Logic a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Cirrus Logic has been 1.5 million shares per day over the past 30 days. Cirrus Logic has a market cap of $1.7 billion and is part of the technology sector and electronics industry. The stock has a beta of 0.31 and a short float of 11.4% with 4.31 days to cover. Shares are up 15.1% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Cirrus Logic as a

buy

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, increase in net income and good cash flow from operations. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:

  • CRUS's very impressive revenue growth greatly exceeded the industry average of 11.5%. Since the same quarter one year prior, revenues leaped by 85.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • CRUS's debt-to-equity ratio is very low at 0.20 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, CRUS has a quick ratio of 1.69, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Powered by its strong earnings growth of 212.50% and other important driving factors, this stock has surged by 31.79% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, CRUS should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 225.5% when compared to the same quarter one year prior, rising from $10.25 million to $33.35 million.
  • Net operating cash flow has significantly increased by 238.25% to $43.18 million when compared to the same quarter last year. In addition, CIRRUS LOGIC INC has also vastly surpassed the industry average cash flow growth rate of -22.76%.

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