Trade-Ideas: JA Solar Holdings Co. ADR (JASO) Is Today's

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 JA Solar Holdings Co. ADR ( JASO) 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 JA Solar Holdings Co. ADR as such a stock due to the following factors:

  • JASO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $20.8 million.
  • JASO has traded 2.9 million shares today.
  • JASO traded in a range 268.6% of the normal price range with a price range of $1.33.
  • JASO traded above its daily resistance level (quality: 21 days, meaning that the stock is crossing a resistance level set by the last 21 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 JASO:

JA Solar Holdings Co., Ltd., through its subsidiaries, engages in the design, development, production, marketing, and sale of solar power products based on crystalline silicon technologies. The company's principal products include monocrystalline and multicrystalline solar cells and modules. Currently there are no analysts that rate JA Solar Holdings Co. ADR a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for JA Solar Holdings Co. ADR has been 2.0 million shares per day over the past 30 days. JA Solar Holdings Co. ADR has a market cap of $283.0 million and is part of the technology sector and electronics industry. Shares are up 65.8% year to date as of the close of trading on Tuesday.

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 JA Solar Holdings Co. ADR as a sell. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:
  • The debt-to-equity ratio of 1.18 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, JASO maintains a poor quick ratio of 0.71, which illustrates the inability to avoid short-term cash problems.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, JA SOLAR HOLDINGS CO LTD's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for JA SOLAR HOLDINGS CO LTD is currently extremely low, coming in at 5.96%. Regardless of JASO's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, JASO's net profit margin of -12.18% significantly underperformed when compared to the industry average.
  • JA SOLAR HOLDINGS CO LTD has improved earnings per share by 15.0% 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, JA SOLAR HOLDINGS CO LTD reported poor results of -$6.81 versus -$2.80 in the prior year. This year, the market expects an improvement in earnings (-$2.33 versus -$6.81).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Semiconductors & Semiconductor Equipment industry average. The net income increased by 17.4% when compared to the same quarter one year prior, going from -$39.84 million to -$32.90 million.

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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