Strong And Under The Radar Today: Conmed (CNMD)

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

  • CNMD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.4 million.
  • CNMD is making at least a new 3-day high.
  • CNMD has a PE ratio of 51.
  • CNMD is mentioned 1.81 times per day on StockTwits.
  • CNMD has not yet been mentioned on StockTwits today.
  • CNMD is currently in the upper 20% of its 1-year range.
  • CNMD is in the upper 35% of its 20-day range.
  • CNMD is in the upper 45% of its 5-day range.
  • CNMD 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 CNMD:

CONMED Corporation, a medical technology company, develops, manufactures, and sells surgical devices and related equipment for minimally invasive procedures and monitoring in the United States, Canada, the United Kingdom, Japan, Australia, and internationally. The stock currently has a dividend yield of 1.4%. CNMD has a PE ratio of 51. Currently there are 4 analysts that rate Conmed a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Conmed has been 145,200 shares per day over the past 30 days. Conmed has a market cap of $1.5 billion and is part of the health care sector and health services industry. The stock has a beta of 1.34 and a short float of 3.3% with 9.34 days to cover. Shares are up 23.5% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Conmed as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, solid stock price performance and expanding profit margins. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.45, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, CNMD has a quick ratio of 1.72, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Compared to its closing price of one year ago, CNMD's share price has jumped by 25.15%, exceeding the performance of the broader market during that same time frame. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • The gross profit margin for CONMED CORP is rather high; currently it is at 57.57%. Regardless of CNMD's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 3.54% trails the industry average.
  • CNMD, with its decline in revenue, underperformed when compared the industry average of 22.6%. Since the same quarter one year prior, revenues slightly dropped by 2.2%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • CONMED CORP's earnings per share declined by 25.8% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, CONMED CORP reported lower earnings of $1.16 versus $1.27 in the prior year. This year, the market expects an improvement in earnings ($1.85 versus $1.16).

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