Today's Strong And Under The Radar Stock Is West Pharmaceutical Services (WST)

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

  • WST has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $11.3 million.
  • WST is making at least a new 3-day high.
  • WST has a PE ratio of 31.9.
  • WST is mentioned 1.32 times per day on StockTwits.
  • WST has not yet been mentioned on StockTwits today.
  • WST is currently in the upper 20% of its 1-year range.
  • WST is in the upper 35% of its 20-day range.
  • WST is in the upper 45% of its 5-day range.
  • WST 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 WST:

West Pharmaceutical Services, Inc. develops, manufactures, and sells components and systems for the packaging and delivery of injectable drugs, as well as delivery system components for the pharmaceutical, healthcare, and consumer products industries. The stock currently has a dividend yield of 0.8%. WST has a PE ratio of 31.9. Currently there is 1 analyst that rates West Pharmaceutical Services a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for West Pharmaceutical Services has been 309,500 shares per day over the past 30 days. West Pharmaceutical Services has a market cap of $3.7 billion and is part of the health care sector and health services industry. The stock has a beta of 0.68 and a short float of 3.1% with 11.43 days to cover. Shares are up 5.9% 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 West Pharmaceutical Services as a buy. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, increase in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • WEST PHARMACEUTICAL SVSC INC has improved earnings per share by 16.2% 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, WEST PHARMACEUTICAL SVSC INC increased its bottom line by earning $1.58 versus $1.15 in the prior year. This year, the market expects an improvement in earnings ($1.81 versus $1.58).
  • 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 Health Care Equipment & Supplies industry average. The net income increased by 15.7% when compared to the same quarter one year prior, going from $26.80 million to $31.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 6.9%. Since the same quarter one year prior, revenues slightly increased by 4.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The current debt-to-equity ratio, 0.35, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, WST has a quick ratio of 1.83, which demonstrates the ability of the company to cover short-term liquidity needs.

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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