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 Valeant Pharmaceuticals International ( VRX) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Valeant Pharmaceuticals International as such a stock due to the following factors:
- VRX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $391.8 million.
- VRX is up 2.6% today from today's close.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in VRX with the Ticky from Trade-Ideas. See the FREE profile for VRX NOW at Trade-Ideas More details on VRX: Valeant Pharmaceuticals International, Inc. develops, manufactures, and markets pharmaceuticals, over-the-counter (OTC) products, and medical devices in the areas of eye health, dermatology, and neurology therapeutic classes worldwide. Currently there are 10 analysts that rate Valeant Pharmaceuticals International a buy, 1 analyst rates it a sell, and 2 rate it a hold. The average volume for Valeant Pharmaceuticals International has been 2.0 million shares per day over the past 30 days. Valeant Pharmaceuticals International has a market cap of $40.9 billion and is part of the health care sector and drugs industry. Shares are up 4% year-to-date as of the close of trading on Thursday. 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 Valeant Pharmaceuticals International as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and increase in net income. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and disappointing return on equity. Highlights from the ratings report include:
- VRX's very impressive revenue growth greatly exceeded the industry average of 0.7%. Since the same quarter one year prior, revenues leaped by 109.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Powered by its strong earnings growth of 224.13% and other important driving factors, this stock has surged by 66.16% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- The gross profit margin for VALEANT PHARMACEUTICALS INTL is currently very high, coming in at 74.32%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, VRX's net profit margin of 5.99% significantly trails the industry average.
- The debt-to-equity ratio is very high at 3.40 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, VRX maintains a poor quick ratio of 0.96, which illustrates the inability to avoid short-term cash problems.
- 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. Compared to other companies in the Pharmaceuticals industry and the overall market, VALEANT PHARMACEUTICALS INTL's return on equity significantly trails that of both the industry average and the S&P 500.
- You can view the full Valeant Pharmaceuticals International 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.