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 Motorola Solutions ( MSI) 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 Motorola Solutions as such a stock due to the following factors:
- MSI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $116.2 million.
- MSI has traded 1.5 million shares today.
- MSI traded in a range 253.9% of the normal price range with a price range of $2.08.
- MSI traded above its daily resistance level (quality: 193 days, meaning that the stock is crossing a resistance level set by the last 193 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 MSI with the Ticky from Trade-Ideas. See the FREE profile for MSI NOW at Trade-Ideas More details on MSI: Motorola Solutions, Inc. provides mission critical communication infrastructure, devices, software, and services worldwide. It operates in two segments, Government and Enterprise. The stock currently has a dividend yield of 2.1%. MSI has a PE ratio of 17.2. Currently there are 6 analysts that rate Motorola Solutions a buy, 1 analyst rates it a sell, and 7 rate it a hold. The average volume for Motorola Solutions has been 2.0 million shares per day over the past 30 days. Motorola has a market cap of $15.9 billion and is part of the technology sector and telecommunications industry. The stock has a beta of 0.71 and a short float of 4% with 5.32 days to cover. Shares are up 7.7% year to date as of the close of trading on Friday. 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 Motorola Solutions as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, notable return on equity and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows weak operating cash flow. Highlights from the ratings report include:
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- MOTOROLA SOLUTIONS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, MOTOROLA SOLUTIONS INC increased its bottom line by earning $3.01 versus $2.20 in the prior year. This year, the market expects an improvement in earnings ($4.44 versus $3.01).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Communications Equipment industry average. The net income increased by 41.8% when compared to the same quarter one year prior, rising from $182.00 million to $258.00 million.
- 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 Communications Equipment industry and the overall market, MOTOROLA SOLUTIONS INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- MSI's debt-to-equity ratio of 0.88 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that MSI's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.80 is high and demonstrates strong liquidity.
- You can view the full Motorola Solutions Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.