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
) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified AmerisourceBergen as such a stock due to the following factors:
- ABC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $193.5 million.
- ABC has a PE ratio of 78.3.
- ABC is currently in the upper 30% of its 1-year range.
- ABC is in the upper 25% of its 20-day range.
- ABC is in the upper 35% of its 5-day range.
- ABC is currently trading above yesterday's high.
- ABC has experienced a gap between today's open and yesterday's close of 3.9%.
'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 ABC:
AmerisourceBergen Corporation sources and distributes pharmaceutical products to healthcare providers, pharmaceutical and biotech manufacturers, and specialty drug patients in the United States and internationally. The stock currently has a dividend yield of 1.2%. ABC has a PE ratio of 78.3. Currently there are 5 analysts that rate AmerisourceBergen a buy, no analysts rate it a sell, and 8 rate it a hold.
The average volume for AmerisourceBergen has been 1.8 million shares per day over the past 30 days. AmerisourceBergen has a market cap of $20.7 billion and is part of the services sector and wholesale industry. Shares are up 6.3% year-to-date as of the close of trading on Monday.
rates AmerisourceBergen as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations, increase in net income, solid stock price performance and growth in earnings per share. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
Highlights from the ratings report include:
- ABC's revenue growth has slightly outpaced the industry average of 20.7%. Since the same quarter one year prior, revenues rose by 29.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving 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 Health Care Providers & Services industry. The net income increased by 32.9% when compared to the same quarter one year prior, rising from $51.02 million to $67.80 million.
- Net operating cash flow has significantly increased by 2784.82% to $830.66 million when compared to the same quarter last year. In addition, AMERISOURCEBERGEN CORP has also vastly surpassed the industry average cash flow growth rate of 16.96%.
- Powered by its strong earnings growth of 31.81% and other important driving factors, this stock has surged by 42.52% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- AMERISOURCEBERGEN CORP has improved earnings per share by 31.8% 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, AMERISOURCEBERGEN CORP reported lower earnings of $1.20 versus $2.10 in the prior year. This year, the market expects an improvement in earnings ($4.48 versus $1.20).
- You can view the full AmerisourceBergen Ratings Report.