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.

Trade-Ideas LLC identified Affymetrix ( AFFX) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Affymetrix as such a stock due to the following factors:

  • AFFX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $16.0 million.
  • AFFX has traded 55,970 shares today.
  • AFFX is up 3.1% today.
  • AFFX was down 5.5% yesterday.

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More details on AFFX:

Affymetrix, Inc. provides life science products and molecular diagnostic products that enable parallel analysis of biological systems at the gene, protein, and cell level primarily in the United States, Europe, Latin America, and Asia. Currently there is 1 analyst that rates Affymetrix a buy, 1 analyst rates it a sell, and 4 rate it a hold.

The average volume for Affymetrix has been 1.2 million shares per day over the past 30 days. Affymetrix has a market cap of $948.9 million and is part of the technology sector and electronics industry. The stock has a beta of -0.57 and a short float of 16% with 6.39 days to cover. Shares are up 21.6% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Affymetrix as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income and weak operating cash flow.

Highlights from the ratings report include:
  • Compared to its closing price of one year ago, AFFX's share price has jumped by 71.16%, 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.
  • The current debt-to-equity ratio, 0.47, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, AFFX has a quick ratio of 1.91, which demonstrates the ability of the company to cover short-term liquidity needs.
  • AFFYMETRIX INC's earnings per share declined by 50.0% 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, AFFYMETRIX INC continued to lose money by earning -$0.07 versus -$0.27 in the prior year. This year, the market expects an improvement in earnings ($0.30 versus -$0.07).
  • 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 Life Sciences Tools & Services industry. The net income has significantly decreased by 44.9% when compared to the same quarter one year ago, falling from $9.37 million to $5.17 million.
  • Net operating cash flow has decreased to $15.15 million or 29.19% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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