Trade-Ideas LLC identified

Akorn

(

AKRX

) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Akorn as such a stock due to the following factors:

  • AKRX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $37.5 million.
  • AKRX has traded 68,679 shares today.
  • AKRX is trading at 2.30 times the normal volume for the stock at this time of day.
  • AKRX is trading at a new high 3.08% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on AKRX:

TheStreet Recommends

Akorn, Inc. develops, manufactures, and markets generic and branded prescription pharmaceuticals, as well as animal and over-the-counter (OTC) consumer health products in the United States and internationally. It operates through two segments, Prescription Pharmaceuticals and Consumer Health. AKRX has a PE ratio of 113. Currently there are 9 analysts that rate Akorn a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Akorn has been 1.3 million shares per day over the past 30 days. Akorn has a market cap of $4.4 billion and is part of the health care sector and drugs industry. The stock has a beta of 1.29 and a short float of 8.6% with 7.27 days to cover. Shares are up 7.8% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Akorn as a

buy

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins, good cash flow from operations, increase in net income and solid stock price performance. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:

  • AKRX's very impressive revenue growth greatly exceeded the industry average of 7.0%. Since the same quarter one year prior, revenues leaped by 168.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The gross profit margin for AKORN INC is rather high; currently it is at 62.95%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 15.02% is above that of the industry average.
  • Net operating cash flow has increased to $16.65 million or 11.61% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -10.37%.
  • 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 105.3% when compared to the same quarter one year prior, rising from $16.68 million to $34.23 million.
  • 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. 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.

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