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 Alexion Pharmaceuticals ( ALXN) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Alexion Pharmaceuticals as such a stock due to the following factors:
- ALXN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $374.4 million.
- ALXN has a PE ratio of 51.1.
- ALXN is currently in the upper 30% of its 1-year range.
- ALXN is in the upper 25% of its 20-day range.
- ALXN is in the upper 35% of its 5-day range.
- ALXN is currently trading above yesterday's high.
- ALXN has experienced a gap between today's open and yesterday's close of 0.8%.
'Momo Momentum' stocks are valuable stocks to watch for a variety of reasons including historical back testing and price action. Market technicians refer to such stocks as being in a mark-up phase before a possible distribution period and price decline. Technical analysts and traders frequently find that the factors referenced above tend to create a temporary burst of strong wind in a stock's sail. Nevertheless, all successful traders must excel at maximizing gains while keeping losses to an absolute minimum. For that reason, the holding period on momo momentum stocks must always be a primary consideration, and this part of the puzzle is ultimately at the discretion of each individual's risk tolerance and portfolio risk management skills. EXCLUSIVE OFFER: Get the inside scoop on opportunities in ALXN with the Ticky from Trade-Ideas. See the FREE profile for ALXN NOW at Trade-Ideas More details on ALXN: Alexion Pharmaceuticals, Inc., a biopharmaceutical company, develops and commercializes life-transforming therapeutic products. ALXN has a PE ratio of 51.1. Currently there are 17 analysts that rate Alexion Pharmaceuticals a buy, no analysts rate it a sell, and 3 rate it a hold. The average volume for Alexion Pharmaceuticals has been 1.2 million shares per day over the past 30 days. Alexion has a market cap of $30.9 billion and is part of the health care sector and drugs industry. The stock has a beta of 0.50 and a short float of 2.2% with 1.67 days to cover. Shares are up 18.4% year-to-date as of the close of trading on Friday. 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 Alexion Pharmaceuticals as a buy. 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, solid stock price performance 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:
- The revenue growth came in higher than the industry average of 12.7%. Since the same quarter one year prior, revenues rose by 37.9%. 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.
- ALXN's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.33, which clearly demonstrates the ability to cover short-term cash needs.
- Compared to its closing price of one year ago, ALXN's share price has jumped by 67.75%, exceeding the performance of the broader market during that same time frame. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- ALEXION PHARMACEUTICALS INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Stable earnings per share over the past year indicate the company has sound management over its earnings and share float. We anticipate these figures will begin to experience more growth in the coming year. During the past fiscal year, ALEXION PHARMACEUTICALS INC reported lower earnings of $1.26 versus $1.27 in the prior year. This year, the market expects an improvement in earnings ($3.84 versus $1.26).
- The gross profit margin for ALEXION PHARMACEUTICALS INC is currently very high, coming in at 88.31%. Regardless of ALXN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ALXN's net profit margin of -4.29% significantly underperformed when compared to the industry average.
- You can view the full Alexion Pharmaceuticals 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.