Trade-Ideas LLC identified

Wright Medical Group

(

WMGI

) 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 Wright Medical Group as such a stock due to the following factors:

  • WMGI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $28.8 million.
  • WMGI has traded 199,167 shares today.
  • WMGI traded in a range 423.5% of the normal price range with a price range of $2.39.
  • WMGI traded above its daily resistance level (quality: 315 days, meaning that the stock is crossing a resistance level set by the last 315 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.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in WMGI with the Ticky from Trade-Ideas. See the FREE profile for WMGI NOW at Trade-Ideas

More details on WMGI:

TheStreet Recommends

Wright Medical Group N.V., a medical device company, designs, manufactures, markets, and sells orthopedic products in the United States, Europe, and internationally. Currently there are 16 analysts that rate Wright Medical Group a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Wright Medical Group has been 1.7 million shares per day over the past 30 days. Wright Medical Group has a market cap of $2.2 billion and is part of the health care sector and health services industry. The stock has a beta of 0.85 and a short float of 13.6% with 10.08 days to cover. Shares are down 9.3% year-to-date as of the close of trading on Friday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Wright Medical Group as a

hold

. 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 and impressive record of earnings per share growth. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.

Highlights from the ratings report include:

  • WMGI's very impressive revenue growth greatly exceeded the industry average of 4.8%. Since the same quarter one year prior, revenues leaped by 132.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.56, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.24, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for WRIGHT MEDICAL GROUP NV is currently very high, coming in at 84.68%. 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 -26.51% is in-line with the industry average.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Health Care Equipment & Supplies industry and the overall market, WRIGHT MEDICAL GROUP NV's return on equity significantly trails that of both the industry average and the S&P 500.
  • WMGI has underperformed the S&P 500 Index, declining 14.31% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.