Today's Dead Cat Bounce Stock Is TAL Education Group (XRS)
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 TAL Education Group (XRS) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified TAL Education Group as such a stock due to the following factors:
- XRS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $12.9 million.
- XRS has traded 227,858 shares today.
- XRS is up 8.1% today.
- XRS was down 19.6% yesterday.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in XRS with the Ticky from Trade-Ideas. See the FREE profile for XRS NOW at Trade-IdeasMore details on XRS: TAL Education Group, together with its subsidiaries, provides K-12 after-school tutoring services under the Xueersi brand name in China. XRS has a PE ratio of 32.5. Currently there are 2 analysts that rate TAL Education Group a buy, no analysts rate it a sell, and 1 rates it a hold.The average volume for TAL Education Group has been 381,600 shares per day over the past 30 days. TAL Education Group has a market cap of $1.9 billion and is part of the services sector and diversified services industry. Shares are up 14.4% year-to-date as of the close of trading on Wednesday.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 TAL Education Group as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, expanding profit margins and impressive record of earnings per share growth. 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:
- The revenue growth greatly exceeded the industry average of 2.1%. Since the same quarter one year prior, revenues rose by 45.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- XRS has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to the other companies in the Diversified Consumer Services industry and the overall market, TAL EDUCATION GROUP's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
- The gross profit margin for TAL EDUCATION GROUP is rather high; currently it is at 53.14%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 19.20% is above that of the industry average.
- TAL EDUCATION GROUP 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 two years. We feel that this trend should continue. During the past fiscal year, TAL EDUCATION GROUP increased its bottom line by earning $0.75 versus $0.43 in the prior year. This year, the market expects an improvement in earnings ($1.01 versus $0.75).
- You can view the full TAL Education Group 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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