NuVasive (NUVA) Flagged As Strong On High Volume

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

  • NUVA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $18.2 million.
  • NUVA has traded 70,533 shares today.
  • NUVA is trading at 4.97 times the normal volume for the stock at this time of day.
  • NUVA is trading at a new high 3.02% 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 NUVA:

NuVasive, Inc., a medical device company, develops and markets minimally disruptive surgical products and procedurally integrated solutions for the spine. Its products focus on applications for spine fusion surgery. Currently there are 10 analysts that rate NuVasive a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for NuVasive has been 298,000 shares per day over the past 30 days. NuVasive has a market cap of $2.0 billion and is part of the health care sector and health services industry. The stock has a beta of 0.72 and a short float of 5.6% with 5.67 days to cover. Shares are up 35.4% year-to-date as of the close of trading on Friday.

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 NuVasive as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:
  • NUVA's revenue growth has slightly outpaced the industry average of 6.3%. Since the same quarter one year prior, revenues rose by 12.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Compared to its closing price of one year ago, NUVA's share price has jumped by 29.91%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • NUVASIVE INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, NUVASIVE INC increased its bottom line by earning $0.16 versus $0.07 in the prior year. This year, the market expects an improvement in earnings ($1.12 versus $0.16).
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Health Care Equipment & Supplies industry and the overall market, NUVASIVE INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Health Care Equipment & Supplies industry. The net income has significantly decreased by 124.4% when compared to the same quarter one year ago, falling from $7.51 million to -$1.83 million.

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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