Trade-Ideas LLC identified SanDisk ( SNDK) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified SanDisk as such a stock due to the following factors:

  • SNDK has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $206.8 million.
  • SNDK has traded 4.8 million shares today.
  • SNDK traded in a range 244.8% of the normal price range with a price range of $4.24.
  • SNDK traded above its daily resistance level (quality: 5 days, meaning that the stock is crossing a resistance level set by the last 5 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in SNDK with the Ticky from Trade-Ideas. See the FREE profile for SNDK NOW at Trade-Ideas

More details on SNDK:

SanDisk Corporation designs, develops, manufactures, and markets data storage solutions in the United States and internationally. The stock currently has a dividend yield of 1.7%. SNDK has a PE ratio of 37. Currently there are 7 analysts that rate SanDisk a buy, 1 analyst rates it a sell, and 11 rate it a hold.

The average volume for SanDisk has been 2.7 million shares per day over the past 30 days. SanDisk has a market cap of $13.6 billion and is part of the technology sector and computer hardware industry. The stock has a beta of 2.37 and a short float of 7.6% with 5.33 days to cover. Shares are down 12.4% year-to-date as of the close of trading on Tuesday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates SanDisk as a hold. The company's strengths can be seen in multiple areas, such as its 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 a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:
  • Despite currently having a low debt-to-equity ratio of 0.37, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that SNDK's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.39 is high and demonstrates strong liquidity.
  • 46.83% is the gross profit margin for SANDISK CORP which we consider to be strong. Regardless of SNDK's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SNDK's net profit margin of 8.77% is significantly lower than the industry average.
  • 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 Computers & Peripherals industry. The net income has significantly decreased by 32.9% when compared to the same quarter one year ago, falling from $201.89 million to $135.47 million.
  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, SNDK has underperformed the S&P 500 Index, declining 15.24% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.