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 Qihoo 360 Technology ( QIHU) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Qihoo 360 Technology as such a stock due to the following factors:
- QIHU has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $206.3 million.
- QIHU has traded 9.4 million shares today.
- QIHU is down 3.2% today.
- QIHU was up 9.3% yesterday.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in QIHU with the Ticky from Trade-Ideas. See the FREE profile for QIHU NOW at Trade-Ideas More details on QIHU: Qihoo 360 Technology Co. Ltd. provides Internet and mobile security products in the People's Republic of China. QIHU has a PE ratio of 98.9. Currently there are 6 analysts that rate Qihoo 360 Technology a buy, no analysts rate it a sell, and 2 rate it a hold. The average volume for Qihoo 360 Technology has been 2.6 million shares per day over the past 30 days. Qihoo 360 Technology has a market cap of $9.8 billion and is part of the technology sector and internet industry. Shares are down 0.8% 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 Qihoo 360 Technology as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that the company's profit margins have been poor overall. Highlights from the ratings report include:
- QIHU's very impressive revenue growth greatly exceeded the industry average of 9.2%. Since the same quarter one year prior, revenues leaped by 123.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- QIHOO 360 TECHNOLGY CO -ADR 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 year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, QIHOO 360 TECHNOLGY CO -ADR increased its bottom line by earning $0.40 versus $0.12 in the prior year. This year, the market expects an improvement in earnings ($1.44 versus $0.40).
- Powered by its strong earnings growth of 209.09% and other important driving factors, this stock has surged by 174.75% over the past year, outperforming the rise in the S&P 500 Index during the same period. Setting our sights on the months ahead, however, we feel that the stock's sharp appreciation over the last year has driven it to a price level which is now relatively expensive compared to the rest of its industry. The implication is that its reduced upside potential is not good enough to warrant further investment at this time.
- QIHU's debt-to-equity ratio of 0.94 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. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 5.97 is very high and demonstrates very strong liquidity.
- The gross profit margin for QIHOO 360 TECHNOLGY CO -ADR is currently very high, coming in at 92.25%. Regardless of QIHU's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, QIHU's net profit margin of 23.65% compares favorably to the industry average.
- You can view the full Qihoo 360 Technology 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.