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 WuXi PharmaTech ( WX) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified WuXi PharmaTech as such a stock due to the following factors:
- WX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $19.6 million.
- WX has traded 81,108 shares today.
- WX is up 3.1% today.
- WX was down 6.4% yesterday.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in WX with the Ticky from Trade-Ideas. See the FREE profile for WX NOW at Trade-Ideas More details on WX: WuXi PharmaTech (Cayman) Inc. operates as a pharmaceutical, biotechnology, and medical device research and development outsourcing company in China and the United States. It operates in two segments, Laboratory Services and Manufacturing Services. WX has a PE ratio of 21.0. Currently there are 6 analysts that rate WuXi PharmaTech a buy, no analysts rate it a sell, and 2 rate it a hold. The average volume for WuXi PharmaTech has been 521,500 shares per day over the past 30 days. WuXi PharmaTech has a market cap of $2.3 billion and is part of the health care sector and health services industry. Shares are down 20.6% 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 WuXi PharmaTech as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, reasonable valuation levels and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income. Highlights from the ratings report include:
- Despite its growing revenue, the company underperformed as compared with the industry average of 18.7%. Since the same quarter one year prior, revenues rose by 11.3%. 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.
- WX's debt-to-equity ratio is very low at 0.12 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 2.53, which clearly demonstrates the ability to cover short-term cash needs.
- 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 Life Sciences Tools & Services industry and the overall market, WUXI PHARMATECH (CAYMAN)-ADR's return on equity exceeds that of both the industry average and the S&P 500.
- Compared to its closing price of one year ago, WX's share price has jumped by 51.25%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, WX should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- You can view the full WuXi PharmaTech 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.