Trade-Ideas: Globus Medical (GMED) 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 Globus Medical ( GMED) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Globus Medical as such a stock due to the following factors:

  • GMED has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $22.1 million.
  • GMED has traded 60,840 shares today.
  • GMED is up 3.4% today.
  • GMED was down 18% yesterday.

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More details on GMED:

Globus Medical, Inc., a medical device company, focuses on the design, development, and commercialization of musculoskeletal implants that promote healing in patients with spine disorders. GMED has a PE ratio of 29.7. Currently there are 5 analysts that rate Globus Medical a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Globus Medical has been 477,000 shares per day over the past 30 days. Globus Medical has a market cap of $1.5 billion and is part of the health care sector and health services industry. The stock has a beta of 2122.19 and a short float of 4.4% with 3.24 days to cover. Shares are down 8.3% year-to-date as of the close of trading on Wednesday.

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 Globus Medical as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and good cash flow from operations. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Health Care Equipment & Supplies industry. The net income increased by 178.0% when compared to the same quarter one year prior, rising from $7.43 million to $20.65 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 8.7%. Since the same quarter one year prior, revenues slightly increased by 6.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • GMED has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 5.24, which clearly demonstrates the ability to cover short-term cash needs.
  • Powered by its strong earnings growth of 175.00% and other important driving factors, this stock has surged by 31.23% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, GMED should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Net operating cash flow has increased to $12.35 million or 37.52% when compared to the same quarter last year. In addition, GLOBUS MEDICAL INC has also vastly surpassed the industry average cash flow growth rate of -14.40%.

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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