Trade-Ideas LLC identified

STMicroelectronics

(

STM

) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified STMicroelectronics as such a stock due to the following factors:

  • STM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $14.2 million.
  • STM has traded 103.3130000000000023874235921539366245269775390625 options contracts today.
  • STM is making at least a new 3-day high.
  • STM has a PE ratio of 47.
  • STM is mentioned 1.32 times per day on StockTwits.
  • STM has not yet been mentioned on StockTwits today.
  • STM is currently in the upper 20% of its 1-year range.
  • STM is in the upper 35% of its 20-day range.
  • STM is in the upper 45% of its 5-day range.
  • STM is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

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More details on STM:

STMicroelectronics N.V., together with its subsidiaries, designs, develops, manufactures, and markets semiconductor products, and subsystems and modules worldwide. The stock currently has a dividend yield of 3.1%. STM has a PE ratio of 47. Currently there is 1 analyst that rates STMicroelectronics a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for STMicroelectronics has been 1.0 million shares per day over the past 30 days. STMicroelectronics has a market cap of $5.8 billion and is part of the technology sector and electronics industry. Shares are up 8.3% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates STMicroelectronics as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.36, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, STM has a quick ratio of 1.80, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 44.39% is the gross profit margin for STMICROELECTRONICS NV which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 1.35% trails the industry average.
  • STM, with its decline in revenue, underperformed when compared the industry average of 14.9%. Since the same quarter one year prior, revenues slightly dropped by 3.2%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, STMICROELECTRONICS NV's return on equity significantly trails that of both the industry average and the S&P 500.
  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, STM has underperformed the S&P 500 Index, declining 6.12% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.

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