Trade-Ideas: Equifax (EFX) Is Today's "Barbarian At The Gate" Stock
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.Trade-Ideas LLC identified Equifax (EFX) 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 Equifax as such a stock due to the following factors:
- EFX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $52.8 million.
- EFX has traded 788,764 shares today.
- EFX traded in a range 315.5% of the normal price range with a price range of $2.41.
- EFX traded above its daily resistance level (quality: 70 days, meaning that the stock is crossing a resistance level set by the last 70 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 EFX with the Ticky from Trade-Ideas. See the FREE profile for EFX NOW at Trade-IdeasMore details on EFX: Equifax Inc. collects, organizes, and manages various financial, demographic, employment, and marketing information solutions for businesses and consumers. The company's U.S. The stock currently has a dividend yield of 1.5%. EFX has a PE ratio of 24.7. Currently there are 4 analysts that rate Equifax a buy, no analysts rate it a sell, and 5 rate it a hold.The average volume for Equifax has been 593,300 shares per day over the past 30 days. Equifax has a market cap of $7.3 billion and is part of the financial sector and financial services industry. The stock has a beta of 0.82 and a short float of 2.4% with 3.51 days to cover. Shares are up 11.4% year to date as of the close of trading on Friday.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.TheStreetRatings.com Analysis:TheStreet Quant Ratings rates Equifax as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, solid stock price performance and growth in earnings per share. We feel these strengths outweigh the fact that the company shows weak operating cash flow.Highlights from the ratings report include:
- EFX's revenue growth has slightly outpaced the industry average of 11.9%. Since the same quarter one year prior, revenues rose by 14.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The debt-to-equity ratio is somewhat low, currently at 0.72, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.13, which illustrates the ability to avoid short-term cash problems.
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- EQUIFAX INC has improved earnings per share by 21.7% 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. During the past fiscal year, EQUIFAX INC increased its bottom line by earning $2.20 versus $1.88 in the prior year. This year, the market expects an improvement in earnings ($3.60 versus $2.20).
- The gross profit margin for EQUIFAX INC is rather high; currently it is at 66.23%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 15.42% is above that of the industry average.
- You can view the full Equifax Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
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