Momentum Ideas: 12 Cash-Rich Companies in Rally Mode

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 |  Includes: ADSK, ALTR, ALXN, CTSH, ILMN, MCO, MOS, NBL, ORCL, PCLN, TDC, VRTX
by: Kapitall

Here we present a list of 12 stocks that are currently rallying above their 20-day, 50-day, and 200-day moving averages. These companies are also rather “cash-comfortable”, with enough cash to cover more than 2 quarters of their average quarterly operating expenses.

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For these companies we calculated the average quarterly operating expense over the last four quarters, and compared it with current cash holdings. All companies listed have more than 2x the cash for their avg. quarterly operating expense, translating into coverage of more than 2 quarters of avg. operating expenses without the need to generate revenue.

Do you think these companies can keep rallying? Read below, using this list as a starting-off point for your own analysis.

List sorted by Cash/Avg. Operating Expense.

1. Altera Corp. (NASDAQ:ALTR): Semiconductor Industry. Market cap of $13.74B. The stock is currently 2.08% above its 20-day moving average, 3.99% above its 50-day MA, and 28.60% above its 200-day MA. Current cash holdings at $2.82B vs. average quarterly operating expenses over the last four quarters at $331.89M. Cash/Avg. Quarterly Operating Expenses at 8.5, i.e. the company can go 8.5 quarters without generating revenue and still cover the average quarterly operating costs. The stock has gained 71.43% over the last year.

2. Illumina Inc. (NASDAQ:ILMN): Biotechnology Industry. Market cap of $9.05B. The stock is currently 7.32% above its 20-day moving average, 2.92% above its 50-day MA, and 24.85% above its 200-day MA. Current cash holdings at $894.29M vs. average quarterly operating expenses over the last four quarters at $172.77M. Cash/Avg. Quarterly Operating Expenses at 5.2, i.e. the company can go 5.2 quarters without generating revenue and still cover the average quarterly operating costs. The stock is a short squeeze candidate, with a short float at 11.33% (equivalent to 7.64 days of average volume).

3. Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX): Drug Manufacturer. Market cap of $9.73B. The stock is currently 2.12% above its 20-day moving average, 9.76% above its 50-day MA, and 27.74% above its 200-day MA. Current cash holdings at $1.03B vs. average quarterly operating expenses over the last four quarters at $209.86M. Cash/Avg. Quarterly Operating Expenses at 4.9, i.e. the company can go 4.9 quarters without generating revenue and still cover the average quarterly operating costs.

4. Oracle Corp. (NASDAQ:ORCL): Application Software Industry. Market cap of $172.16B. The stock is currently 7.06% above its 20-day moving average, 5.63% above its 50-day MA, and 21.92% above its 200-day MA. Current cash holdings at $24.36B vs. average quarterly operating expenses over the last four quarters at $5.84B. Cash/Avg. Quarterly Operating Expenses at 4.2, i.e. the company can go 4.2 quarters without generating revenue and still cover the average quarterly operating costs. The stock has gained 33.99% over the last year.

5. Alexion Pharmaceuticals, Inc. (NASDAQ:ALXN): Drug Manufacturer. Market cap of $9.13B. The stock is currently 3.87% above its 20-day moving average, 8.42% above its 50-day MA, and 38.29% above its 200-day MA. Current cash holdings at $361.61M vs. average quarterly operating expenses over the last four quarters at $97.58M. Cash/Avg. Quarterly Operating Expenses at 3.7, i.e. the company can go 3.7 quarters without generating revenue and still cover the average quarterly operating costs. ALXN has a relatively low correlation to the market (beta = 0.65), which may be appealing to risk-averse investors. The stock has gained 5.46% over the last week.

6. Autodesk, Inc. (NASDAQ:ADSK): Technical & System Software Industry. Market cap of $9.99B. The stock is currently 7.08% above its 20-day moving average, 6.10% above its 50-day MA, and 26.51% above its 200-day MA. Current cash holdings at $1.27B vs. average quarterly operating expenses over the last four quarters at $420.10M. Cash/Avg. Quarterly Operating Expenses at 3.0, i.e. the company can go 3.0 quarters without generating revenue and still cover the average quarterly operating costs. Note that this is a risky stock that is significantly more volatile than the overall market (beta = 2.12).

7. Priceline.com Incorporated (NASDAQ:PCLN): General Entertainment Industry. Market cap of $25.26B. The stock is currently 8.47% above its 20-day moving average, 12.59% above its 50-day MA, and 41.22% above its 200-day MA. Current cash holdings at $1.66B vs. average quarterly operating expenses over the last four quarters at $574.53M. Cash/Avg. Quarterly Operating Expenses at 2.9, i.e. the company can go 2.9 quarters without generating revenue and still cover the average quarterly operating costs. The stock has gained 5.51% over the last week.

8. Cognizant Technology Solutions Corp. (NASDAQ:CTSH): Business Software & Services Industry. Market cap of $25.07B. The stock is currently 5.86% above its 20-day moving average, 7.87% above its 50-day MA, and 23.48% above its 200-day MA. Current cash holdings at $2.23B vs. average quarterly operating expenses over the last four quarters at $932.63M. Cash/Avg. Quarterly Operating Expenses at 2.4, i.e. the company can go 2.4 quarters without generating revenue and still cover the average quarterly operating costs. The stock has gained 58.54% over the last year.

9. Teradata Corporation (NYSE:TDC): Diversified Computer Systems Industry. Market cap of $8.52B. The stock is currently 1.39% above its 20-day moving average, 5.79% above its 50-day MA, and 27.08% above its 200-day MA. Current cash holdings at $883.00M vs. average quarterly operating expenses over the last four quarters at $380.25M. Cash/Avg. Quarterly Operating Expenses at 2.3, i.e. the company can go 2.3 quarters without generating revenue and still cover the average quarterly operating costs. The stock has gained 72.66% over the last year.

10. Moody's Corp. (NYSE:MCO): Business Services Industry. Market cap of $7.88B. The stock is currently 5.90% above its 20-day moving average, 11.00% above its 50-day MA, and 30.97% above its 200-day MA. Current cash holdings at $672.30M vs. average quarterly operating expenses over the last four quarters at $314.80M. Cash/Avg. Quarterly Operating Expenses at 2.1, i.e. the company can go 2.1 quarters without generating revenue and still cover the average quarterly operating costs. The stock is a short squeeze candidate, with a short float at 10.82% (equivalent to 10.52 days of average volume). The stock has gained 19.12% over the last year.

11. Noble Energy, Inc. (NYSE:NBL): Independent Oil & Gas Industry. Market cap of $16.86B. The stock is currently 2.93% above its 20-day moving average, 6.33% above its 50-day MA, and 21.81% above its 200-day MA. Current cash holdings at $1.08B vs. average quarterly operating expenses over the last four quarters at $519.75M. Cash/Avg. Quarterly Operating Expenses at 2.1, i.e. the company can go 2.1 quarters without generating revenue and still cover the average quarterly operating costs. The stock has gained 25.42% over the last year.

12. Mosaic Co. (NYSE:MOS): Agricultural Chemicals Industry. Market cap of $35.89B. The stock is currently 4.48% above its 20-day moving average, 0.61% above its 50-day MA, and 23.54% above its 200-day MA. Current cash holdings at $3.35B vs. average quarterly operating expenses over the last four quarters at $1.64B. Cash/Avg. Quarterly Operating Expenses at 2.0, i.e. the company can go 2.0 quarters without generating revenue and still cover the average quarterly operating costs. The stock has gained 39.05% over the last year.

*Cash and operating expense data sourced from Google Finance, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.