Adeptus Health (ADPT) Marked As A Barbarian At The Gate

Trade-Ideas LLC identified Adeptus Health (ADPT) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Adeptus Health

(

ADPT

) 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 Adeptus Health as such a stock due to the following factors:

  • ADPT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $21.9 million.
  • ADPT has traded 301,496 shares today.
  • ADPT traded in a range 209.4% of the normal price range with a price range of $3.83.
  • ADPT traded above its daily resistance level (quality: 26 days, meaning that the stock is crossing a resistance level set by the last 26 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.

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More details on ADPT:

Adeptus Health Inc. owns and operates a network of independent freestanding emergency rooms in the United States. As of December 31, 2015, it operated 81 facilities located in the Houston, Dallas/Fort Worth, San Antonio, Austin, Colorado Springs, Denver, and Phoenix. ADPT has a PE ratio of 38. Currently there are 4 analysts that rate Adeptus Health a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Adeptus Health has been 561,600 shares per day over the past 30 days. Adeptus Health has a market cap of $1.1 billion and is part of the health care sector and health services industry. The stock has a beta of 0.83 and a short float of 77.5% with 18.43 days to cover. Shares are down 7.6% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Adeptus Health as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, premium valuation and generally higher debt management risk.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 8.8%. Since the same quarter one year prior, revenues rose by 38.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • ADEPTUS HEALTH INC 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 year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, ADEPTUS HEALTH INC turned its bottom line around by earning $1.17 versus -$0.35 in the prior year. This year, the market expects an improvement in earnings ($2.62 versus $1.17).
  • ADPT's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 45.62%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.

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