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

Varian Medical Systems

(

VAR

) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Varian Medical Systems as such a stock due to the following factors:

  • VAR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $66.3 million.
  • VAR has traded 106,377 shares today.
  • VAR is trading at a new lifetime high.

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More details on VAR:

Varian Medical Systems, Inc. designs, manufactures, sells, and services medical devices and software products for treating cancer and other medical conditions in the United States. The company operates in two segments, Oncology Systems and Imaging Components. VAR has a PE ratio of 22.7. Currently there are 6 analysts that rate Varian Medical Systems a buy, 1 analyst rates it a sell, and none rate it a hold.

TheStreet Recommends

The average volume for Varian Medical Systems has been 647,900 shares per day over the past 30 days. Varian Medical Systems has a market cap of $8.7 billion and is part of the health care sector and health services industry. The stock has a beta of 0.55 and a short float of 5.9% with 8.34 days to cover. Shares are up 0% year-to-date as of the close of trading on Wednesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Varian Medical Systems as a

buy

. 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, good cash flow from operations, increase in stock price during the past year and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • VAR's revenue growth has slightly outpaced the industry average of 4.6%. Since the same quarter one year prior, revenues slightly increased by 5.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • VAR's debt-to-equity ratio is very low at 0.27 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.37, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has increased to $193.40 million or 24.82% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -6.75%.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. 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.
  • 43.90% is the gross profit margin for VARIAN MEDICAL SYSTEMS INC which we consider to be strong. Regardless of VAR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 13.03% trails the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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