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 Cavium ( CAVM) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Cavium as such a stock due to the following factors:

  • CAVM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $30.3 million.
  • CAVM has traded 17,368 shares today.
  • CAVM is trading at a new lifetime high.

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More details on CAVM:

Cavium, Inc. designs, develops, and markets semiconductor processors for intelligent and secure networks. The company operates through Semiconductor Products, and Software and Services segments. Currently there are 10 analysts that rate Cavium a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Cavium has been 776,300 shares per day over the past 30 days. Cavium has a market cap of $3.0 billion and is part of the technology sector and electronics industry. Shares are up 65.5% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Cavium 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 solid stock price performance. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.

Highlights from the ratings report include:
  • CAVM's revenue growth has slightly outpaced the industry average of 18.6%. Since the same quarter one year prior, revenues rose by 23.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • CAVM's debt-to-equity ratio is very low at 0.16 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, CAVM has a quick ratio of 2.31, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The gross profit margin for CAVIUM INC is currently very high, coming in at 72.25%. Regardless of CAVM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, CAVM's net profit margin of 5.55% is significantly lower than the industry average.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, CAVIUM INC's return on equity significantly trails that of both the industry average and the S&P 500.

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