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 Illumina ( ILMN) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Illumina as such a stock due to the following factors:
- ILMN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $177.8 million.
- ILMN has a PE ratio of 97.8.
- ILMN is currently in the upper 30% of its 1-year range.
- ILMN is in the upper 25% of its 20-day range.
- ILMN is in the upper 35% of its 5-day range.
- ILMN is currently trading above yesterday's high.
- ILMN has experienced a gap between today's open and yesterday's close of 1%.
'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 ILMN with the Ticky from Trade-Ideas. See the FREE profile for ILMN NOW at Trade-Ideas More details on ILMN: Illumina, Inc. develops, manufactures, and markets life science tools and integrated systems for the analysis of genetic variation and function in North America, Europe, Latin America, the Asia-Pacific, the Middle East, and South Africa. ILMN has a PE ratio of 97.8. Currently there are 9 analysts that rate Illumina a buy, no analysts rate it a sell, and 8 rate it a hold. The average volume for Illumina has been 2.2 million shares per day over the past 30 days. Illumina has a market cap of $18.6 billion and is part of the health care sector and drugs industry. The stock has a beta of 0.84 and a short float of 21% with 17.13 days to cover. Shares are up 30.2% 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 Illumina 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, compelling growth in net income, solid stock price performance and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows weak operating cash flow. Highlights from the ratings report include:
- ILMN's revenue growth has slightly outpaced the industry average of 20.0%. Since the same quarter one year prior, revenues rose by 27.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The current debt-to-equity ratio, 0.54, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.20, which illustrates the ability to avoid short-term cash problems.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Life Sciences Tools & Services industry. The net income increased by 365.5% when compared to the same quarter one year prior, rising from -$22.59 million to $59.98 million.
- Powered by its strong earnings growth of 322.22% and other important driving factors, this stock has surged by 105.69% over the past year, outperforming the rise in the S&P 500 Index during the same period. 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.
- ILLUMINA INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. 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, ILLUMINA INC reported lower earnings of $0.86 versus $1.13 in the prior year. This year, the market expects an improvement in earnings ($2.15 versus $0.86).
- You can view the full Illumina 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.