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 Avago Technologies as such a stock due to the following factors:
- AVGO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $221.6 million.
- AVGO has a PE ratio of 31.9.
- AVGO is currently in the upper 30% of its 1-year range.
- AVGO is in the upper 25% of its 20-day range.
- AVGO is in the upper 35% of its 5-day range.
- AVGO is currently trading above yesterday's high.
- AVGO has experienced a gap between today's open and yesterday's close of 1.5%.
'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 AVGO:
Avago Technologies Limited is engaged in the design, development, and supply of analog semiconductor devices with a focus on III-V based products. The stock currently has a dividend yield of 1.5%. AVGO has a PE ratio of 31.9. Currently there are 13 analysts that rate Avago Technologies a buy, no analysts rate it a sell, and 5 rate it a hold.
The average volume for Avago Technologies has been 3.5 million shares per day over the past 30 days. Avago has a market cap of $17.7 billion and is part of the technology sector and electronics industry. The stock has a beta of 0.87 and a short float of 1.4% with 0.89 days to cover. Shares are up 32.6% year-to-date as of the close of trading on Wednesday.
rates Avago Technologies as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, expanding profit margins and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 4.1%. Since the same quarter one year prior, revenues rose by 23.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- AVGO's debt-to-equity ratio is very low at 0.00 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 3.94, which clearly demonstrates the ability to cover short-term cash needs.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 98.72% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, AVGO should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The gross profit margin for AVAGO TECHNOLOGIES LTD is rather high; currently it is at 55.71%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 18.89% is above that of the industry average.
- Net operating cash flow has increased to $229.00 million or 23.78% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 4.26%.
- You can view the full Avago Technologies Ratings Report.