Trade-Ideas LLC identified

Medivation

(

MDVN

) 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 Medivation as such a stock due to the following factors:

  • MDVN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $86.5 million.
  • MDVN has traded 409,638 shares today.
  • MDVN traded in a range 234.1% of the normal price range with a price range of $1.99.
  • MDVN traded above its daily resistance level (quality: 423 days, meaning that the stock is crossing a resistance level set by the last 423 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 MDVN:

Medivation, Inc., a biopharmaceutical company, focuses on the development and commercialization of medical therapies to treat serious diseases in the United States. It offers XTANDI for the treatment of post-chemotherapy metastatic castration-resistant prostate cancer (CRPC) patients. MDVN has a PE ratio of 4. Currently there are 9 analysts that rate Medivation a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Medivation has been 2.4 million shares per day over the past 30 days. Medivation has a market cap of $10.3 billion and is part of the health care sector and drugs industry. The stock has a beta of 1.44 and a short float of 2.3% with 2.05 days to cover. Shares are up 29.3% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Medivation 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 shows low profit margins.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 20.2%. Since the same quarter one year prior, revenues rose by 41.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • MDVN's debt-to-equity ratio is very low at 0.02 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.98, which clearly demonstrates the ability to cover short-term cash needs.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen 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 Biotechnology industry. The net income increased by 254.4% when compared to the same quarter one year prior, rising from -$3.12 million to $4.82 million.
  • Net operating cash flow has significantly increased by 189.55% to $165.69 million when compared to the same quarter last year. In addition, MEDIVATION INC has also vastly surpassed the industry average cash flow growth rate of 6.25%.

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