Today's Momo Momentum Stock To Watch: Edwards Lifesciences (EW) - TheStreet

Trade-Ideas LLC identified

Edwards Lifesciences

(

EW

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

  • EW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $221.3 million.
  • EW has a PE ratio of 37.
  • EW is currently in the upper 30% of its 1-year range.
  • EW is in the upper 25% of its 20-day range.
  • EW is in the upper 35% of its 5-day range.
  • EW is currently trading above yesterday's high.
  • EW has experienced a gap between today's open and yesterday's close of 5.8%.

'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 EW:

Edwards Lifesciences Corporation provides products and technologies to treat structural heart disease and critically ill patients worldwide. EW has a PE ratio of 37. Currently there are 13 analysts that rate Edwards Lifesciences a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Edwards Lifesciences has been 1.2 million shares per day over the past 30 days. Edwards Lifesciences has a market cap of $16.0 billion and is part of the health care sector and health services industry. The stock has a beta of 0.57 and a short float of 1.8% with 2.03 days to cover. Shares are up 17.7% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Edwards Lifesciences as a

buy

. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • Compared to its closing price of one year ago, EW's share price has jumped by 41.15%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, EW should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • EW's revenue growth trails the industry average of 35.9%. Since the same quarter one year prior, revenues slightly increased by 7.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • EW's debt-to-equity ratio is very low at 0.26 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 3.95, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for EDWARDS LIFESCIENCES CORP is currently very high, coming in at 77.01%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 18.27% is above that of the industry average.
  • EDWARDS LIFESCIENCES CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, EDWARDS LIFESCIENCES CORP increased its bottom line by earning $7.52 versus $3.41 in the prior year. For the next year, the market is expecting a contraction of 41.8% in earnings ($4.38 versus $7.52).

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