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

  • IMMR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.5 million.
  • IMMR has traded 163.701999999999998181010596454143524169921875 options contracts today.
  • IMMR is making at least a new 3-day high.
  • IMMR has a PE ratio of 105.
  • IMMR is mentioned 1.68 times per day on StockTwits.
  • IMMR has not yet been mentioned on StockTwits today.
  • IMMR is currently in the upper 20% of its 1-year range.
  • IMMR is in the upper 35% of its 20-day range.
  • IMMR is in the upper 45% of its 5-day range.
  • IMMR 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 IMMR:

Immersion Corporation, an intellectual property and software licensing company, creates, designs, develops, and licenses technologies in North America, Europe, Asia, and internationally. IMMR has a PE ratio of 105. Currently there are 4 analysts that rate Immersion a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Immersion has been 248,300 shares per day over the past 30 days. Immersion has a market cap of $355.1 million and is part of the technology sector and computer software & services industry. The stock has a beta of 0.60 and a short float of 8% with 5.39 days to cover. Shares are up 31.7% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Immersion as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and increase in net income. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and poor profit margins.

Highlights from the ratings report include:
  • IMMR's revenue growth has slightly outpaced the industry average of 36.8%. Since the same quarter one year prior, revenues rose by 37.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • IMMR has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 2.86, which clearly demonstrates the ability to cover short-term cash needs.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.
  • The gross profit margin for IMMERSION CORP is currently extremely low, coming in at 13.67%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, IMMR's net profit margin of 9.83% is significantly lower than the industry average.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. In comparison to the other companies in the Computers & Peripherals industry and the overall market, IMMERSION CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.

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