Trade-Ideas LLC identified

Ingram Micro

(

IM

) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Ingram Micro as such a stock due to the following factors:

  • IM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $43.8 million.
  • IM has traded 96,312 shares today.
  • IM traded in a range 224% of the normal price range with a price range of $1.30.
  • IM traded above its daily resistance level (quality: 458 days, meaning that the stock is crossing a resistance level set by the last 458 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on IM:

Ingram Micro Inc. distributes information technology (IT) products; and provides supply chain and mobile device lifecycle services worldwide. The stock currently has a dividend yield of 1.4%. IM has a PE ratio of 23. Currently there are 6 analysts that rate Ingram Micro a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Ingram Micro has been 1.3 million shares per day over the past 30 days. Ingram Micro has a market cap of $4.5 billion and is part of the services sector and wholesale industry. The stock has a beta of 1.04 and a short float of 2.2% with 1.96 days to cover. Shares are up 4.8% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Ingram Micro as a

buy

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

Highlights from the ratings report include:

  • Net operating cash flow has significantly increased by 2296.77% to $567.95 million when compared to the same quarter last year. In addition, INGRAM MICRO INC has also vastly surpassed the industry average cash flow growth rate of 28.32%.
  • 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, despite the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • IM's debt-to-equity ratio is very low at 0.29 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.94 is somewhat weak and could be cause for future problems.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 5.2%. Since the same quarter one year prior, revenues slightly dropped by 3.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • INGRAM MICRO INC 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. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, INGRAM MICRO INC reported lower earnings of $1.67 versus $1.98 in the prior year. This year, the market expects an improvement in earnings ($2.68 versus $1.67).

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