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Trade-Ideas LLC identified

Affymetrix

(

AFFX

) 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 Affymetrix as such a stock due to the following factors:

  • AFFX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $22.0 million.
  • AFFX has traded 668,708 shares today.
  • AFFX traded in a range 206.2% of the normal price range with a price range of $0.18.
  • AFFX traded above its daily resistance level (quality: 531 days, meaning that the stock is crossing a resistance level set by the last 531 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 AFFX:

TheStreet Recommends

Affymetrix, Inc. provides life science products and molecular diagnostic products that enable parallel analysis of biological systems at the gene, protein, and cell level primarily in the United States, Europe, Latin America, and Asia. AFFX has a PE ratio of 1. Currently there is 1 analyst that rates Affymetrix a buy, 1 analyst rates it a sell, and 5 rate it a hold.

The average volume for Affymetrix has been 2.4 million shares per day over the past 30 days. Affymetrix has a market cap of $1.1 billion and is part of the technology sector and electronics industry. The stock has a beta of -0.72 and a short float of 12.8% with 4.85 days to cover. Shares are up 39.1% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Affymetrix as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and good cash flow from operations. However, as a counter to these strengths, we find that the growth in the company's net income has been quite unimpressive.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.38, is low and is below the industry average, implying that there has been successful management of debt levels. Along with this, the company maintains a quick ratio of 2.61, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for AFFYMETRIX INC is rather high; currently it is at 69.99%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -6.23% is in-line with the industry average.
  • Net operating cash flow has increased to $23.12 million or 11.71% when compared to the same quarter last year. Despite an increase in cash flow, AFFYMETRIX INC's cash flow growth rate is still lower than the industry average growth rate of 27.18%.
  • 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. In comparison to the other companies in the Life Sciences Tools & Services industry and the overall market, AFFYMETRIX INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Life Sciences Tools & Services industry. The net income has significantly decreased by 323.8% when compared to the same quarter one year ago, falling from $2.38 million to -$5.34 million.

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