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 Amphenol ( APH) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Amphenol as such a stock due to the following factors:

  • APH has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $70.6 million.
  • APH has traded 127,412 shares today.
  • APH traded in a range 203.9% of the normal price range with a price range of $1.55.
  • APH traded below its daily resistance level (quality: 84 days, meaning that the stock is crossing a resistance level set by the last 84 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Water-Logged and Getting Wetter' 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 negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.

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More details on APH:

Amphenol Corporation designs, manufactures, and markets electrical, electronic, and fiber optic connectors; interconnect systems, antennas, sensors, and sensor-based products; and coaxial and specialty cables worldwide. The stock currently has a dividend yield of 1%. APH has a PE ratio of 25.3. Currently there are 3 analysts that rate Amphenol a buy, no analysts rate it a sell, and 7 rate it a hold.

The average volume for Amphenol has been 608,800 shares per day over the past 30 days. Amphenol has a market cap of $15.3 billion and is part of the technology sector and electronics industry. The stock has a beta of 1.22 and a short float of 1.4% with 2.84 days to cover. Shares are up 11.9% 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 Amphenol as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, solid stock price performance and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:
  • APH's revenue growth has slightly outpaced the industry average of 5.8%. Since the same quarter one year prior, revenues rose by 15.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • AMPHENOL CORP has improved earnings per share by 14.7% 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, AMPHENOL CORP increased its bottom line by earning $3.92 versus $3.39 in the prior year. This year, the market expects an improvement in earnings ($4.40 versus $3.92).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Electronic Equipment, Instruments & Components industry average. The net income increased by 13.6% when compared to the same quarter one year prior, going from $153.99 million to $174.93 million.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 27.29% over the past year, a rise that has exceeded that of the S&P 500 Index. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • Net operating cash flow has remained constant at $180.68 million with no significant change when compared to the same quarter last year. Along with maintaining stable cash flow from operations, the firm exceeded the industry average cash flow growth rate of -22.84%.

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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