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 Infoblox ( BLOX) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Infoblox as such a stock due to the following factors:

  • BLOX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $73.5 million.
  • BLOX has traded 328,176 shares today.
  • BLOX is down 3.1% today.
  • BLOX was up 7.8% yesterday.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in BLOX with the Ticky from Trade-Ideas. See the FREE profile for BLOX NOW at Trade-Ideas

More details on BLOX:

Infoblox Inc. develops, markets, and sells automated network control solutions worldwide. Its appliance-based solution combines real-time IP address management with the automation of network control, and network change and configuration management processes in physical and virtual appliances. Currently there are 7 analysts that rate Infoblox a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Infoblox has been 1.0 million shares per day over the past 30 days. Infoblox has a market cap of $1.6 billion and is part of the services sector and diversified services industry. Shares are up 63.5% year-to-date as of the close of trading on Thursday.

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 Infoblox as a hold. 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 and solid stock price performance. However, as a counter to these strengths, we find that the growth in the company's net income has been quite unimpressive.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 6.3%. Since the same quarter one year prior, revenues rose by 28.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • BLOX has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 2.70, which clearly demonstrates the ability to cover short-term cash needs.
  • INFOBLOX INC reported flat earnings per share in the most recent quarter. 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, INFOBLOX INC continued to lose money by earning -$0.10 versus -$0.14 in the prior year. This year, the market expects an improvement in earnings ($0.52 versus -$0.10).
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Software industry and the overall market, INFOBLOX INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Software industry. The net income has decreased by 6.7% when compared to the same quarter one year ago, dropping from -$2.39 million to -$2.55 million.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

null