Trade-Ideas: PerkinElmer (PKI) Is Today's

Trade-Ideas LLC identified PerkinElmer ( PKI) 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 PerkinElmer as such a stock due to the following factors:

  • PKI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $26.2 million.
  • PKI has traded 84,727 shares today.
  • PKI traded in a range 286.6% of the normal price range with a price range of $2.65.
  • PKI traded above its daily resistance level (quality: 532 days, meaning that the stock is crossing a resistance level set by the last 532 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 PKI:

PerkinElmer, Inc. provides products, services, and solutions to the diagnostics, research, environmental, industrial, and laboratory services markets worldwide. The company operates through two segments, Human Health and Environmental Health. The stock currently has a dividend yield of 0.5%. PKI has a PE ratio of 27. Currently there are 6 analysts that rate PerkinElmer a buy, 1 analyst rates it a sell, and 7 rate it a hold.

The average volume for PerkinElmer has been 791,700 shares per day over the past 30 days. PerkinElmer has a market cap of $5.6 billion and is part of the health care sector and health services industry. The stock has a beta of 0.71 and a short float of 3.2% with 6.40 days to cover. Shares are down 6.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates PerkinElmer as a buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:
  • PERKINELMER 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 year. We feel that this trend should continue. During the past fiscal year, PERKINELMER INC increased its bottom line by earning $1.88 versus $1.42 in the prior year. This year, the market expects an improvement in earnings ($2.70 versus $1.88).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Life Sciences Tools & Services industry. The net income increased by 121.7% when compared to the same quarter one year prior, rising from $30.79 million to $68.25 million.
  • The current debt-to-equity ratio, 0.48, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.21, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for PERKINELMER INC is rather high; currently it is at 51.02%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 11.22% is above that of the industry average.

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