Strong On High Volume: Integrated Device Technology (IDTI)

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 Integrated Device Technology ( IDTI) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Integrated Device Technology as such a stock due to the following factors:

  • IDTI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $52.9 million.
  • IDTI has traded 212,294 shares today.
  • IDTI is trading at 2.12 times the normal volume for the stock at this time of day.
  • IDTI is trading at a new high 3.00% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on IDTI:

Integrated Device Technology, Inc. designs, develops, manufactures, and markets a range of mixed signal semiconductor solutions for the communications, computing, and consumer industries worldwide. It operates in two segments, Communications, and Computing and Consumer. IDTI has a PE ratio of 18.8. Currently there are 2 analysts that rate Integrated Device Technology a buy, 1 analyst rates it a sell, and 1 rates it a hold.

The average volume for Integrated Device Technology has been 3.1 million shares per day over the past 30 days. Integrated Device Technology has a market cap of $2.3 billion and is part of the technology sector and electronics industry. The stock has a beta of 2.11 and a short float of 3.1% with 1.72 days to cover. Shares are up 58.6% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Integrated Device Technology 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, notable return on equity and solid stock price performance. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

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 Semiconductors & Semiconductor Equipment industry. The net income increased by 1064.8% when compared to the same quarter one year prior, rising from -$2.26 million to $21.84 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 10.3%. Since the same quarter one year prior, revenues slightly increased by 7.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • IDTI 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 7.69, which clearly demonstrates the ability to cover short-term cash needs.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, INTEGRATED DEVICE TECH INC's return on equity exceeds that of both the industry average and the S&P 500.
  • Powered by its strong earnings growth of 1000.00% and other important driving factors, this stock has surged by 78.96% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.

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