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
) 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 Avis Budget Group as such a stock due to the following factors:
- CAR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $127.9 million.
- CAR has traded 2.9 million shares today.
- CAR traded in a range 208% of the normal price range with a price range of $4.17.
- CAR traded above its daily resistance level (quality: 14 days, meaning that the stock is crossing a resistance level set by the last 14 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.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in CAR with the Ticky from Trade-Ideas. See the FREE profile for CAR NOW at Trade-Ideas
More details on CAR:
Avis Budget Group, Inc., together with its subsidiaries, provides car and truck rentals, car sharing, and ancillary services to businesses and consumers worldwide. The company has three segments: North America, International, and Truck Rental. CAR has a PE ratio of 33.0. Currently there are 3 analysts that rate Avis Budget Group a buy, 1 analyst rates it a sell, and 2 rate it a hold.
The average volume for Avis Budget Group has been 2.5 million shares per day over the past 30 days. Avis Budget Group has a market cap of $6.2 billion and is part of the services sector and diversified services industry. The stock has a beta of 2.10 and a short float of 11.9% with 6.16 days to cover. Shares are up 43.9% year-to-date as of the close of trading on Friday.
rates Avis Budget Group as a
. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, notable return on equity, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Road & Rail industry. The net income increased by 62.7% when compared to the same quarter one year prior, rising from $118.00 million to $192.00 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 10.5%. Since the same quarter one year prior, revenues slightly increased by 6.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
- 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 Road & Rail industry and the overall market, AVIS BUDGET GROUP INC's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
- Net operating cash flow has increased to $1,056.00 million or 21.51% when compared to the same quarter last year. In addition, AVIS BUDGET GROUP INC has also modestly surpassed the industry average cash flow growth rate of 21.29%.
- The gross profit margin for AVIS BUDGET GROUP INC is rather high; currently it is at 52.05%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, CAR's net profit margin of 7.55% significantly trails the industry average.
- You can view the full Avis Budget Group Ratings Report.