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 Dr. Reddy Laboratories ( RDY) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Dr. Reddy Laboratories as such a stock due to the following factors:

  • RDY has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.2 million.
  • RDY has traded 4,529 shares today.
  • RDY is trading at a new lifetime high.

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More details on RDY:

Dr. Reddy's Laboratories Limited operates as an integrated pharmaceutical company. It operates in three segments: Pharmaceutical services and Active Ingredients (PSAI), Global Generics, and Proprietary Products. The stock currently has a dividend yield of 0.5%. RDY has a PE ratio of 23.8. Currently there are 2 analysts that rate Dr. Reddy Laboratories a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Dr. Reddy Laboratories has been 189,100 shares per day over the past 30 days. Dr. Reddy has a market cap of $7.3 billion and is part of the health care sector and drugs industry. Shares are up 5.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Dr. Reddy Laboratories as a buy. The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year, growth in earnings per share, increase in net income, largely solid financial position with reasonable debt levels by most measures and notable return on equity. 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. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • DR REDDY'S LABORATORIES LTD has improved earnings per share by 40.9% 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, DR REDDY'S LABORATORIES LTD increased its bottom line by earning $1.79 versus $1.65 in the prior year. This year, the market expects an improvement in earnings ($1.89 versus $1.79).
  • 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 39.0% when compared to the same quarter one year prior, rising from $77.20 million to $107.34 million.
  • The debt-to-equity ratio is somewhat low, currently at 0.63, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.10, which illustrates the ability to avoid short-term cash problems.
  • 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. When compared to other companies in the Pharmaceuticals industry and the overall market, DR REDDY'S LABORATORIES LTD's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.

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