Strong And Under The Radar Today: Bio-Rad Laboratories (BIO)

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 Bio-Rad Laboratories ( BIO) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Bio-Rad Laboratories as such a stock due to the following factors:

  • BIO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $15.8 million.
  • BIO is making at least a new 3-day high.
  • BIO has a PE ratio of 44.1.
  • BIO is mentioned 0.52 times per day on StockTwits.
  • BIO has not yet been mentioned on StockTwits today.
  • BIO is currently in the upper 20% of its 1-year range.
  • BIO is in the upper 35% of its 20-day range.
  • BIO is in the upper 45% of its 5-day range.
  • BIO 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 BIO:

Bio-Rad Laboratories, Inc. manufactures and supplies products and systems used to separate complex chemical and biological materials, as well as to identify, analyze, and purify their components for life science research, healthcare, analytical chemistry, and other markets. BIO has a PE ratio of 44.1. Currently there is 1 analyst that rates Bio-Rad Laboratories a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Bio-Rad Laboratories has been 171,600 shares per day over the past 30 days. Bio-Rad has a market cap of $3.2 billion and is part of the health care sector and health services industry. The stock has a beta of 1.05 and a short float of 5.8% with 10.06 days to cover. Shares are up 11.9% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Bio-Rad Laboratories 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, largely solid financial position with reasonable debt levels by most measures, expanding profit margins and increase in stock price during the past year. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • BIO-RAD LABORATORIES INC has improved earnings per share by 28.8% 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 year. We feel that this trend should continue. During the past fiscal year, BIO-RAD LABORATORIES INC increased its bottom line by earning $3.05 versus $2.69 in the prior year. This year, the market expects an improvement in earnings ($3.15 versus $3.05).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Life Sciences Tools & Services industry. The net income increased by 29.5% when compared to the same quarter one year prior, rising from $30.14 million to $39.04 million.
  • BIO's debt-to-equity ratio is very low at 0.20 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, BIO has a quick ratio of 2.41, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The gross profit margin for BIO-RAD LABORATORIES INC is rather high; currently it is at 61.36%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 6.52% trails the industry average.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. 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.

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