Trade-Ideas: Flextronics International (FLEX) Is Today's Post-Market Leader Stock

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 Flextronics International ( FLEX) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Flextronics International as such a stock due to the following factors:

  • FLEX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $54.1 million.
  • FLEX is up 3.9% today from today's close.

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More details on FLEX:

Flextronics International Ltd. provides design and manufacturing services to original equipment manufacturers (OEMs) worldwide. FLEX has a PE ratio of 25.9. Currently there are 3 analysts that rate Flextronics International a buy, no analysts rate it a sell, and 7 rate it a hold.

The average volume for Flextronics International has been 5.3 million shares per day over the past 30 days. Flextronics International has a market cap of $4.6 billion and is part of the technology sector and electronics industry. The stock has a beta of 0.95 and a short float of 0.6% with 0.62 days to cover. Shares are down 1.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Flextronics International as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • FLEX's revenue growth has slightly outpaced the industry average of 1.7%. Since the same quarter one year prior, revenues slightly increased by 3.8%. 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.
  • FLEXTRONICS INTERNATIONAL's earnings per share declined by 20.8% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, FLEXTRONICS INTERNATIONAL reported lower earnings of $0.45 versus $0.71 in the prior year. This year, the market expects an improvement in earnings ($0.80 versus $0.45).
  • 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. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • FLEX's debt-to-equity ratio of 0.97 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. Despite the fact that FLEX's debt-to-equity ratio is mixed in its results, the company's quick ratio of 0.55 is low and demonstrates weak liquidity.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. When compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, FLEXTRONICS INTERNATIONAL's return on equity is below that of both the industry average and the S&P 500.

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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