Trade-Ideas: Providence Service (PRSC) Is Today's Strong And Under The Radar 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.
Trade-Ideas LLC identified
(
) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Providence Service as such a stock due to the following factors:
- PRSC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.7 million.
- PRSC is making at least a new 3-day high.
- PRSC has a PE ratio of 38.6.
- PRSC is mentioned 1.26 times per day on StockTwits.
- PRSC has not yet been mentioned on StockTwits today.
- PRSC is currently in the upper 20% of its 1-year range.
- PRSC is in the upper 35% of its 20-day range.
- PRSC is in the upper 45% of its 5-day range.
- PRSC is currently trading above yesterday's high.
'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.
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More details on PRSC:
The Providence Service Corporation provides and manages government sponsored human services and non-emergency transportation services. The company operates in two segments, Human Services and Non-Emergency Transportation Services (NET Services). PRSC has a PE ratio of 38.6. Currently there are 3 analysts that rate Providence Service a buy, no analysts rate it a sell, and none rate it a hold.
The average volume for Providence Service has been 111,400 shares per day over the past 30 days. Providence Service has a market cap of $697.5 million and is part of the health care sector and health services industry. The stock has a beta of 0.58 and a short float of 7.8% with 9.20 days to cover. Shares are up 22.8% year-to-date as of the close of trading on Thursday.
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Analysis:
rates Providence Service as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, reasonable valuation levels and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and generally higher debt management risk.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 18.4%. Since the same quarter one year prior, revenues rose by 42.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Compared to its closing price of one year ago, PRSC's share price has jumped by 56.25%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- Net operating cash flow has slightly increased to $16.10 million or 3.30% when compared to the same quarter last year. Despite an increase in cash flow of 3.30%, PROVIDENCE SERVICE CORP is still growing at a significantly lower rate than the industry average of 113.25%.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Health Care Providers & Services industry and the overall market, PROVIDENCE SERVICE CORP's return on equity is below that of both the industry average and the S&P 500.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Health Care Providers & Services industry. The net income has significantly decreased by 92.5% when compared to the same quarter one year ago, falling from $3.53 million to $0.27 million.
- You can view the full Providence Service Ratings Report.
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