Trade-Ideas LLC identified

Pegasystems

(

PEGA

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

  • PEGA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.8 million.
  • PEGA has traded 18.83579999999999898818714427761733531951904296875 options contracts today.
  • PEGA is making at least a new 3-day high.
  • PEGA has a PE ratio of 56.
  • PEGA is mentioned 1.61 times per day on StockTwits.
  • PEGA has not yet been mentioned on StockTwits today.
  • PEGA is currently in the upper 20% of its 1-year range.
  • PEGA is in the upper 35% of its 20-day range.
  • PEGA is in the upper 45% of its 5-day range.
  • PEGA 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 PEGA:

Pegasystems, Inc. develops, markets, licenses, and supports software to automate complex and changing business processes in the United States and internationally. The stock currently has a dividend yield of 0.4%. PEGA has a PE ratio of 56. Currently there are 2 analysts that rate Pegasystems a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Pegasystems has been 180,000 shares per day over the past 30 days. Pegasystems has a market cap of $2.1 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.28 and a short float of 2.1% with 3.71 days to cover. Shares are up 1.8% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Pegasystems as a

buy

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, solid stock price performance and impressive record of earnings per share growth. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:

  • PEGA's revenue growth has slightly outpaced the industry average of 10.2%. Since the same quarter one year prior, revenues rose by 16.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • PEGA has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, PEGA has a quick ratio of 1.61, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Software industry and the overall market, PEGASYSTEMS INC's return on equity exceeds that of both the industry average and the S&P 500.
  • 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. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • PEGASYSTEMS INC has improved earnings per share by 37.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, PEGASYSTEMS INC increased its bottom line by earning $0.46 versus $0.41 in the prior year. This year, the market expects an improvement in earnings ($0.95 versus $0.46).

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