Trade-Ideas: Cooper Companies (COO) Is Today's

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 Cooper Companies ( COO) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Cooper Companies as such a stock due to the following factors:

  • COO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $61.2 million.
  • COO has traded 249,666 shares today.
  • COO traded in a range 238.6% of the normal price range with a price range of $5.05.
  • COO traded above its daily resistance level (quality: 530 days, meaning that the stock is crossing a resistance level set by the last 530 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on COO:

The Cooper Companies, Inc. operates as a medical device company worldwide. The stock currently has a dividend yield of 0%. COO has a PE ratio of 22.7. Currently there are 7 analysts that rate Cooper Companies a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Cooper Companies has been 424,700 shares per day over the past 30 days. Cooper Companies has a market cap of $6.6 billion and is part of the health care sector and health services industry. The stock has a beta of -0.08 and a short float of 7.3% with 9.02 days to cover. Shares are up 9.4% year-to-date as of the close of trading on Monday.

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 Cooper Companies 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, growth in earnings per share, increase in net income and good cash flow from operations. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • COO's revenue growth has slightly outpaced the industry average of 3.6%. Since the same quarter one year prior, revenues slightly increased by 7.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • COO's debt-to-equity ratio is very low at 0.13 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.22, which illustrates the ability to avoid short-term cash problems.
  • COOPER COMPANIES INC has improved earnings per share by 6.6% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, COOPER COMPANIES INC increased its bottom line by earning $5.96 versus $5.06 in the prior year. This year, the market expects an improvement in earnings ($6.89 versus $5.96).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the Health Care Equipment & Supplies industry average, but is less than that of the S&P 500. The net income increased by 5.3% when compared to the same quarter one year prior, going from $75.14 million to $79.16 million.
  • Net operating cash flow has slightly increased to $126.33 million or 9.94% when compared to the same quarter last year. In addition, COOPER COMPANIES INC has also modestly surpassed the industry average cash flow growth rate of 7.63%.

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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