Strong And Under The Radar: Ormat Technologies (ORA)

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 Ormat Technologies ( ORA) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Ormat Technologies as such a stock due to the following factors:

  • ORA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.8 million.
  • ORA is making at least a new 3-day high.
  • ORA has a PE ratio of 41.
  • ORA is mentioned 0.42 times per day on StockTwits.
  • ORA has not yet been mentioned on StockTwits today.
  • ORA is currently in the upper 20% of its 1-year range.
  • ORA is in the upper 35% of its 20-day range.
  • ORA is in the upper 45% of its 5-day range.
  • ORA 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 ORA:

Ormat Technologies, Inc. engages in the geothermal and recovered energy power business worldwide. The company operates in two segments, Electricity and Product. The stock currently has a dividend yield of 0.6%. ORA has a PE ratio of 41. Currently there is 1 analyst that rates Ormat Technologies a buy, 1 analyst rates it a sell, and 1 rates it a hold.

The average volume for Ormat Technologies has been 216,400 shares per day over the past 30 days. Ormat has a market cap of $1.8 billion and is part of the utilities sector and utilities industry. The stock has a beta of 0.94 and a short float of 5.5% with 15.73 days to cover. Shares are up 37.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Ormat Technologies 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 reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:
  • Compared to its closing price of one year ago, ORA's share price has jumped by 35.78%, 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.
  • ORMAT TECHNOLOGIES INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from 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, ORMAT TECHNOLOGIES INC increased its bottom line by earning $1.18 versus $0.80 in the prior year. This year, the market expects an improvement in earnings ($1.43 versus $1.18).
  • ORA, with its decline in revenue, underperformed when compared the industry average of 2.8%. Since the same quarter one year prior, revenues fell by 15.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Independent Power Producers & Energy Traders industry and the overall market, ORMAT TECHNOLOGIES INC's return on equity is below that of both the industry average and the S&P 500.
  • 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 Independent Power Producers & Energy Traders industry. The net income has significantly decreased by 53.5% when compared to the same quarter one year ago, falling from $21.55 million to $10.03 million.

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