Trade-Ideas LLC identified

Allegiant Travel

(

ALGT

) 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 Allegiant Travel as such a stock due to the following factors:

  • ALGT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $25.7 million.
  • ALGT has traded 153,321 shares today.
  • ALGT traded in a range 238.4% of the normal price range with a price range of $9.28.
  • ALGT traded above its daily resistance level (quality: 28 days, meaning that the stock is crossing a resistance level set by the last 28 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 ALGT:

Allegiant Travel Company, a leisure travel company, focuses on the provision of travel services and products to residents of under-served cities in the United States. The stock currently has a dividend yield of 1.1%. ALGT has a PE ratio of 1. Currently there are 3 analysts that rate Allegiant Travel a buy, 1 analyst rates it a sell, and 5 rate it a hold.

The average volume for Allegiant Travel has been 138,200 shares per day over the past 30 days. Allegiant Travel has a market cap of $2.3 billion and is part of the services sector and transportation industry. The stock has a beta of 0.04 and a short float of 6.5% with 5.07 days to cover. Shares are down 14.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Allegiant Travel as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, expanding profit margins, growth in earnings per share and increase in net income. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • ALGT's revenue growth has slightly outpaced the industry average of 2.5%. Since the same quarter one year prior, revenues slightly increased by 5.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • ALLEGIANT TRAVEL CO has improved earnings per share by 14.7% 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, ALLEGIANT TRAVEL CO increased its bottom line by earning $12.92 versus $4.79 in the prior year. This year, the market expects an improvement in earnings ($13.81 versus $12.92).
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Airlines industry average. The net income increased by 11.0% when compared to the same quarter one year prior, going from $64.87 million to $71.98 million.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. When compared to other companies in the Airlines industry and the overall market, ALLEGIANT TRAVEL CO's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
  • 48.27% is the gross profit margin for ALLEGIANT TRAVEL CO which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 20.64% significantly outperformed against the industry average.

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