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 Mindray Medical International Limited ADR r ( MR) 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 Mindray Medical International Limited ADR r as such a stock due to the following factors:

  • MR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $38.1 million.
  • MR has traded 392,181 shares today.
  • MR traded in a range 203.2% of the normal price range with a price range of $1.82.
  • MR traded above its daily resistance level (quality: 46 days, meaning that the stock is crossing a resistance level set by the last 46 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 MR:

Mindray Medical International Limited, through its subsidiary, Shenzhen Mindray, develops, manufactures, and markets medical devices worldwide. It operates in three segments: Patient Monitoring and Life Support Products, In-Vitro Diagnostic Products, and Medical Imaging Systems. The stock currently has a dividend yield of 1.2%. MR has a PE ratio of 21.9. Currently there are 4 analysts that rate Mindray Medical International Limited ADR r a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for Mindray Medical International Limited ADR r has been 842,700 shares per day over the past 30 days. Mindray Medical International Limited ADR r has a market cap of $4.8 billion and is part of the health care sector and health services industry. Shares are up 21.8% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Mindray Medical International Limited ADR r as a buy. 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, reasonable valuation levels, good cash flow from operations and expanding profit margins. 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:
  • The revenue growth came in higher than the industry average of 3.8%. Since the same quarter one year prior, revenues rose by 15.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • MR's debt-to-equity ratio is very low at 0.22 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 2.71, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has increased to $67.10 million or 13.15% when compared to the same quarter last year. In addition, MINDRAY MEDICAL INTL has also vastly surpassed the industry average cash flow growth rate of -50.64%.
  • The gross profit margin for MINDRAY MEDICAL INTL is rather high; currently it is at 60.78%. 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 10.14% trails the industry average.

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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