Bristol-Myers Squibb Company (BMY) Showing Signs Of Being A Momo Momentum 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 Bristol-Myers Squibb Company ( BMY) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Bristol-Myers Squibb Company as such a stock due to the following factors:

  • BMY has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $445.5 million.
  • BMY has a PE ratio of 56.4.
  • BMY is currently in the upper 30% of its 1-year range.
  • BMY is in the upper 25% of its 20-day range.
  • BMY is in the upper 35% of its 5-day range.
  • BMY is currently trading above yesterday's high.
  • BMY has experienced a gap between today's open and yesterday's close of 0%.

'Momo Momentum' stocks are valuable stocks to watch for a variety of reasons including historical back testing and price action. Market technicians refer to such stocks as being in a mark-up phase before a possible distribution period and price decline. Technical analysts and traders frequently find that the factors referenced above tend to create a temporary burst of strong wind in a stock's sail. Nevertheless, all successful traders must excel at maximizing gains while keeping losses to an absolute minimum. For that reason, the holding period on momo momentum stocks must always be a primary consideration, and this part of the puzzle is ultimately at the discretion of each individual's risk tolerance and portfolio risk management skills.

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More details on BMY:

Bristol-Myers Squibb Company, a biopharmaceutical company, discovers, develops, licenses, manufactures, markets, distributes, and sells biopharmaceutical products that help patients prevail over serious diseases worldwide. The stock currently has a dividend yield of 3%. BMY has a PE ratio of 56.4. Currently there are 7 analysts that rate Bristol-Myers Squibb Company a buy, 1 analyst rates it a sell, and 10 rate it a hold.

The average volume for Bristol-Myers Squibb Company has been 7.1 million shares per day over the past 30 days. Bristol-Myers Squibb has a market cap of $77.1 billion and is part of the health care sector and drugs industry. The stock has a beta of 0.22 and a short float of 1.8% with 3.61 days to cover. Shares are up 43.7% year to date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Bristol-Myers Squibb Company as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, compelling growth in net income, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • BMY's revenue growth has slightly outpaced the industry average of 2.6%. Since the same quarter one year prior, revenues slightly increased by 8.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Pharmaceuticals industry and the overall market, BRISTOL-MYERS SQUIBB CO's return on equity exceeds that of both the industry average and the S&P 500.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Pharmaceuticals industry. The net income increased by 197.3% when compared to the same quarter one year prior, rising from -$711.00 million to $692.00 million.
  • The current debt-to-equity ratio, 0.49, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that BMY's debt-to-equity ratio is low, the quick ratio, which is currently 0.55, displays a potential problem in covering short-term cash needs.
  • Powered by its strong earnings growth of 197.67% and other important driving factors, this stock has surged by 49.37% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.

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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