Today's Strong And Under The Radar Stock: Abaxis (ABAX)

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 Abaxis ( ABAX) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Abaxis as such a stock due to the following factors:

  • ABAX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.7 million.
  • ABAX is making at least a new 3-day high.
  • ABAX has a PE ratio of 75.1.
  • ABAX is mentioned 0.68 times per day on StockTwits.
  • ABAX has not yet been mentioned on StockTwits today.
  • ABAX is currently in the upper 20% of its 1-year range.
  • ABAX is in the upper 35% of its 20-day range.
  • ABAX is in the upper 45% of its 5-day range.
  • ABAX is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

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More details on ABAX:

Abaxis, Inc. develops, manufactures, markets, and sells portable blood analysis systems for use in human or veterinary patient care settings to provide blood constituent measurements for clinicians worldwide. It operates in two segments, Medical Market and Veterinary Market. The stock currently has a dividend yield of 0.8%. ABAX has a PE ratio of 75.1. Currently there is 1 analyst that rates Abaxis a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Abaxis has been 171,900 shares per day over the past 30 days. Abaxis has a market cap of $1.2 billion and is part of the health care sector and health services industry. The stock has a beta of 0.77 and a short float of 18% with 13.54 days to cover. Shares are up 30.3% year-to-date as of the close of trading on Tuesday.

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 Abaxis 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, increase in net income, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • ABAX's revenue growth has slightly outpaced the industry average of 7.8%. Since the same quarter one year prior, revenues slightly increased by 10.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • ABAX's debt-to-equity ratio is very low at 0.00 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 5.99, which clearly demonstrates the ability to cover short-term cash needs.
  • 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 46.0% when compared to the same quarter one year prior, rising from $3.23 million to $4.72 million.
  • The gross profit margin for ABAXIS INC is rather high; currently it is at 54.61%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 9.93% trails the industry average.
  • Powered by its strong earnings growth of 50.00% and other important driving factors, this stock has surged by 30.81% 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.

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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