Trade-Ideas: Spreadtrum Communications (SPRD) Is Today's New Lifetime High Stock

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 Spreadtrum Communications ( SPRD) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Spreadtrum Communications as such a stock due to the following factors:

  • SPRD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $37.7 million.
  • SPRD has traded 376,567 shares today.
  • SPRD is trading at a new lifetime high.

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More details on SPRD:

Spreadtrum Communications, Inc., a fabless semiconductor company, engages in the design, development, and marketing of mobile chipset platforms for smartphones, feature phones, and other consumer electronics products in Hong Kong, Mailand China, and others. The stock currently has a dividend yield of 1.3%. SPRD has a PE ratio of 15.5. Currently there is 1 analyst that rates Spreadtrum Communications a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Spreadtrum Communications has been 1.7 million shares per day over the past 30 days. Spreadtrum has a market cap of $1.4 billion and is part of the technology sector and electronics industry. Shares are up 69.9% year to date as of the close of trading on Monday.

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 Spreadtrum Communications as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, increase in net income, expanding profit margins and growth in earnings per share. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:
  • SPRD's very impressive revenue growth greatly exceeded the industry average of 12.9%. Since the same quarter one year prior, revenues leaped by 60.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 56.09% and other important driving factors, this stock has surged by 63.72% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, SPRD should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 66.2% when compared to the same quarter one year prior, rising from $20.95 million to $34.83 million.
  • 37.77% is the gross profit margin for SPREADTRUM COMMUNICATNS -ADR which we consider to be strong. 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 12.53% trails the industry average.
  • SPREADTRUM COMMUNICATNS -ADR reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, SPREADTRUM COMMUNICATNS -ADR reported lower earnings of $1.79 versus $2.51 in the prior year. This year, the market expects an improvement in earnings ($2.37 versus $1.79).

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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