Barbarian At The Gate: Total System Services (TSS)
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 Total System Services (TSS) 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 Total System Services as such a stock due to the following factors:
- TSS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $39.5 million.
- TSS has traded 811,192 shares today.
- TSS traded in a range 686.9% of the normal price range with a price range of $3.66.
- TSS traded above its daily resistance level (quality: 1 day, meaning that the stock is crossing a resistance level set by the last 1 calendar day. 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 TSS with the Ticky from Trade-Ideas. See the FREE profile for TSS NOW at Trade-IdeasMore details on TSS: Total System Services, Inc. provides payment processing and other services to card-issuing and merchant acquiring institutions in the United States and internationally. It operates through three segments: North America Services, International Services, and Merchant Services. The stock currently has a dividend yield of 1.3%. TSS has a PE ratio of 24.1. Currently there are 8 analysts that rate Total System Services a buy, no analysts rate it a sell, and 8 rate it a hold.The average volume for Total System Services has been 1.2 million shares per day over the past 30 days. Total System Services has a market cap of $5.8 billion and is part of the financial sector and financial services industry. The stock has a beta of 0.97 and a short float of 2.3% with 3.20 days to cover. Shares are down 8.1% year-to-date as of the close of trading on Tuesday.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 Total System Services 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, growth in earnings per share, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.Highlights from the ratings report include:
- The revenue growth greatly exceeded the industry average of 17.7%. Since the same quarter one year prior, revenues rose by 25.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The debt-to-equity ratio is somewhat low, currently at 0.97, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. To add to this, TSS has a quick ratio of 2.21, which demonstrates the ability of the company to cover short-term liquidity needs.
- TOTAL SYSTEM SERVICES INC has improved earnings per share by 6.3% 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, TOTAL SYSTEM SERVICES INC increased its bottom line by earning $1.29 versus $1.14 in the prior year. This year, the market expects an improvement in earnings ($1.72 versus $1.29).
- Net operating cash flow has increased to $150.24 million or 15.05% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -4.66%.
- 43.00% is the gross profit margin for TOTAL SYSTEM SERVICES INC which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, TSS's net profit margin of 10.94% significantly trails the industry average.
- You can view the full Total System Services 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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