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 Martin Marietta Materials ( MLM) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Martin Marietta Materials as such a stock due to the following factors:

  • MLM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $214.0 million.
  • MLM has a PE ratio of 51.7.
  • MLM is currently in the upper 30% of its 1-year range.
  • MLM is in the upper 25% of its 20-day range.
  • MLM is in the upper 35% of its 5-day range.
  • MLM is currently trading above yesterday's high.
  • MLM has experienced a gap between today's open and yesterday's close of 0.6%.

'Momo Momentum' stocks are valuable stocks to watch for a variety of reasons including historical back testing and price action. Market technicians refer to such stocks as being in a mark-up phase before a possible distribution period and price decline. Technical analysts and traders frequently find that the factors referenced above tend to create a temporary burst of strong wind in a stock's sail. Nevertheless, all successful traders must excel at maximizing gains while keeping losses to an absolute minimum. For that reason, the holding period on momo momentum stocks must always be a primary consideration, and this part of the puzzle is ultimately at the discretion of each individual's risk tolerance and portfolio risk management skills.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in MLM with the Ticky from Trade-Ideas. See the FREE profile for MLM NOW at Trade-Ideas

More details on MLM:

Martin Marietta Materials, Inc., together with its subsidiaries, produces and sells aggregates for the construction industry. The company operates in four segments: Mid-America Group, Southeast Group, West Group, and Specialty Products. The stock currently has a dividend yield of 1.1%. MLM has a PE ratio of 51.7. Currently there are 3 analysts that rate Martin Marietta Materials a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Martin Marietta Materials has been 838,700 shares per day over the past 30 days. Martin Marietta has a market cap of $9.4 billion and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 1.40 and a short float of 12.4% with 3.40 days to cover. Shares are up 28.8% year-to-date as of the close of trading on Thursday.

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 Martin Marietta Materials as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations, solid stock price performance, growth in earnings per share and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • MLM's very impressive revenue growth greatly exceeded the industry average of 20.7%. Since the same quarter one year prior, revenues leaped by 57.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Net operating cash flow has increased to $180.07 million or 25.65% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 6.01%.
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • MARTIN MARIETTA MATERIALS has improved earnings per share by 20.5% in the most recent quarter compared to 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, MARTIN MARIETTA MATERIALS reported lower earnings of $2.53 versus $2.61 in the prior year. This year, the market expects an improvement in earnings ($5.25 versus $2.53).
  • Despite currently having a low debt-to-equity ratio of 0.36, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.34 is sturdy.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

null