New Lifetime High Reached: Covidien (COV)

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

  • COV has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $180.4 million.
  • COV has traded 78,248 shares today.
  • COV is trading at a new lifetime high.

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More details on COV:

Covidien plc develops, manufactures, and sells healthcare products for use in clinical and home settings worldwide. The stock currently has a dividend yield of 1.9%. COV has a PE ratio of 20.1. Currently there are 14 analysts that rate Covidien a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Covidien has been 2.0 million shares per day over the past 30 days. Covidien has a market cap of $30.8 billion and is part of the health care sector and health services industry. The stock has a beta of 1.21 and a short float of 1.2% with 2.28 days to cover. Shares are down 0% year-to-date as of the close of trading on Wednesday.

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 Covidien as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, reasonable valuation levels, increase in stock price during the past year and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • COV's revenue growth has slightly outpaced the industry average of 3.4%. Since the same quarter one year prior, revenues slightly increased by 2.4%. 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.
  • 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 Health Care Equipment & Supplies industry and the overall market, COVIDIEN PLC's return on equity exceeds that of both the industry average and the S&P 500.
  • COVIDIEN PLC' earnings per share from the most recent quarter came in slightly below the year earlier 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, COVIDIEN PLC increased its bottom line by earning $3.40 versus $3.37 in the prior year. This year, the market expects an improvement in earnings ($4.00 versus $3.40).
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. 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.

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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