Trade-Ideas: Synaptics (SYNA) Is Today's Post-Market Leader Stock

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 Synaptics ( SYNA) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Synaptics as such a stock due to the following factors:

  • SYNA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $58.0 million.
  • SYNA is up 3.4% today from today's close.

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More details on SYNA:

Synaptics Incorporated develops, markets, and sells custom-designed human interface solutions for electronic devices and products primarily in China, South Korea, Taiwan, the United States, Japan, and other countries. SYNA has a PE ratio of 64.5. Currently there are 9 analysts that rate Synaptics a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Synaptics has been 1.0 million shares per day over the past 30 days. Synaptics has a market cap of $2.2 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 2.09 and a short float of 12.5% with 4.67 days to cover. Shares are up 20.8% 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 Synaptics as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and feeble growth in the company's earnings per share.

Highlights from the ratings report include:
  • SYNA's revenue growth has slightly outpaced the industry average of 18.6%. Since the same quarter one year prior, revenues rose by 27.0%. 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.
  • SYNA 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 2.53, which clearly demonstrates the ability to cover short-term cash needs.
  • 45.43% is the gross profit margin for SYNAPTICS INC which we consider to be strong. Regardless of SYNA's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SYNA's net profit margin of 9.40% is significantly lower than the industry average.
  • 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 Semiconductors & Semiconductor Equipment industry. The net income has decreased by 23.9% when compared to the same quarter one year ago, dropping from $34.94 million to $26.59 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. In comparison to the other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, SYNAPTICS INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.

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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