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Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified

Teva Pharmaceutical Industries

(

TEVA

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

  • TEVA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $356.6 million.
  • TEVA has a PE ratio of 19.1.
  • TEVA is currently in the upper 30% of its 1-year range.
  • TEVA is in the upper 25% of its 20-day range.
  • TEVA is in the upper 35% of its 5-day range.
  • TEVA is currently trading above yesterday's high.
  • TEVA has experienced a gap between today's open and yesterday's close of 2.5%.

'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 TEVA:

Teva Pharmaceutical Industries Limited develops, manufactures, markets, and distributes pharmaceutical products worldwide. The stock currently has a dividend yield of 2.5%. TEVA has a PE ratio of 19.1. Currently there are 5 analysts that rate Teva Pharmaceutical Industries a buy, 3 analysts rate it a sell, and 10 rate it a hold.

The average volume for Teva Pharmaceutical Industries has been 6.9 million shares per day over the past 30 days. Teva has a market cap of $36.3 billion and is part of the health care sector and drugs industry. Shares are up 9.2% year-to-date as of the close of trading on Monday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Teva Pharmaceutical Industries as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income, largely solid financial position with reasonable debt levels by most measures, increase in stock price during the past year and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:

  • TEVA's revenue growth has slightly outpaced the industry average of 1.4%. 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 net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Pharmaceuticals industry. The net income increased by 1000.0% when compared to the same quarter one year prior, rising from -$79.00 million to $711.00 million.
  • The current debt-to-equity ratio, 0.56, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that TEVA's debt-to-equity ratio is low, the quick ratio, which is currently 0.52, displays a potential problem in covering short-term cash needs.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • TEVA PHARMACEUTICALS reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, TEVA PHARMACEUTICALS reported lower earnings of $2.24 versus $3.08 in the prior year. This year, the market expects an improvement in earnings ($4.98 versus $2.24).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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