INTERDIGITAL INC (NASDAQ:IDCC) Shows Strong Trend and Growth Momentum

INTERDIGITAL INC (NASDAQ:IDCC) has recently appeared through a screening method that joins Mark Minervini's strict Trend Template with a concentration on strong growth momentum. This two-part method aims to find companies that are both in strong technical uptrends and show the fundamental earnings and revenue speed that frequently comes before major price gains. The method stresses buying stocks in a Stage 2 climb, where the mix of firm price action and solid underlying business growth makes a good setting for large returns.

Technical Strength and the Trend Template

A central idea of the Minervini method is to invest in the direction of the main trend, which is methodically assessed using the Trend Template. INTERDIGITAL INC shows a strong technical picture by satisfying these important conditions:

• Price Above Key Moving Averages: The present price of $396.37 trades well above the climbing 50-day ($332.16), 150-day ($259.41), and 200-day ($245.26) simple moving averages. This arrangement confirms a firm bullish trend across several timeframes.
• Moving Average Arrangement: The 50-day moving average is located above both the 150-day and 200-day averages, and the 150-day is above the 200-day. This ordered, climbing formation is a standard mark of a sound Stage 2 uptrend, showing continued and speeding momentum.
• Nearness to Highs: The stock is trading within 4% of its 52-week high of $412.60, an important Minervini filter. Stocks close to new highs often have little overhead resistance and hold the momentum to keep their climb. Also, the share price is over 140% above its 52-week low, indicating a firm recovery and trend.
• Better Relative Strength: With a ChartMill Relative Strength rating of 95.92, IDCC is doing better than almost 96% of all stocks in the market. Minervini gives great importance to relative strength, as market leaders that do better than their competitors during uptrends are most probable to become the largest winners.

Fundamentals Driving High Growth Momentum

The technical strength is backed by a fundamental picture that matches well with a high-growth investment idea. The company's recent financial performance displays the type of fast growth that draws institutional interest and can support additional price increases.

• Earnings Speed Increase: The company has shown notable earnings ability. Earnings per Share (TTM) grew about 65% year-over-year. Even more strong is the recent quarterly speed increase, with the last quarter displaying EPS growth of over 123% compared to the same quarter last year.
• Firm Revenue Growth: Top-line growth is also notable, with TTM revenue rising over 58%. The most recent quarter had sales grow nearly 28% year-over-year, showing continued demand for the company's technologies.
• Growing Profitability: An important sign of a high-quality growth company is the ability to turn revenue into profits. INTERDIGITAL's profit margin in the last quarter was 60.07%, displaying a major growth from 54.92% the previous quarter and 26.57% two quarters before. This pattern of growing margins indicates pricing ability and operational effectiveness.
• Positive Analyst Changes: The market's future expectations are climbing, with analysts changing their next-year EPS estimates upward by nearly 30% over the last three months. Such positive changes frequently work as a trigger, pulling more investors to a stock.

Technical Analysis Overview

The provided technical report gives INTERDIGITAL INC a top rating of 10 out of 10, reflecting outstanding technical condition. The long-term trend is classified as positive, and the stock is noted for its steady performance and position as a market leader within the Software industry, doing better than 89% of its competitors. The report also finds several important support levels between $239 and $379, which can work as logical areas for risk management. While the setup rating is presently a 5, suggesting the stock may be stretched in the short term and waiting for a more ideal consolidation, the underlying technical strength stays clear. For a detailed breakdown of the technical indicators and support levels, you can review the full technical analysis report.

Discovering Similar Opportunities

INTERDIGITAL INC shows the strong combination of a firm technical trend and speeding fundamental growth. For investors looking for other companies that match this high-growth, momentum-based picture, this screen can be used to find a selected list of possible candidates.

Disclaimer: This article is for informational and educational purposes only and does not constitute investment advice. The information provided should not be used as the sole basis for making any investment decision. Please conduct your own due diligence and consult with a qualified financial advisor before trading.