Trade-Ideas LLC identified IDEXX Laboratories ( IDXX) 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 IDEXX Laboratories as such a stock due to the following factors:

  • IDXX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $46.6 million.
  • IDXX has traded 51,237 shares today.
  • IDXX traded in a range 228.8% of the normal price range with a price range of $3.93.
  • IDXX traded above its daily resistance level (quality: 195 days, meaning that the stock is crossing a resistance level set by the last 195 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.

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More details on IDXX:

IDEXX Laboratories, Inc., together with its subsidiaries, develops, manufactures, and distributes products and services primarily for the companion animal veterinary, livestock and poultry, water testing, and dairy markets worldwide. IDXX has a PE ratio of 38. Currently there are 3 analysts that rate IDEXX Laboratories a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for IDEXX Laboratories has been 764,600 shares per day over the past 30 days. IDEXX has a market cap of $7.0 billion and is part of the health care sector and drugs industry. The stock has a beta of 0.28 and a short float of 7.6% with 11.88 days to cover. Shares are up 6.6% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates IDEXX Laboratories as a hold. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, increase in net income and revenue growth. However, as a counter to these strengths, we find that the stock has had a decline in price during the past year.

Highlights from the ratings report include:
  • IDEXX LABS INC reported significant earnings per share improvement 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 two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, IDEXX LABS INC increased its bottom line by earning $2.05 versus $1.78 in the prior year. This year, the market expects an improvement in earnings ($2.15 versus $2.05).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Health Care Equipment & Supplies industry. The net income increased by 70.8% when compared to the same quarter one year prior, rising from $25.96 million to $44.35 million.
  • The gross profit margin for IDEXX LABS INC is rather high; currently it is at 58.90%. Regardless of IDXX'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 11.09% trails the industry average.
  • After a year of stock price fluctuations, the net result is that IDXX's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.

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