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

Charles River Laboratories International In

(

CRL

) 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 Charles River Laboratories International In as such a stock due to the following factors:

  • CRL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $37.1 million.
  • CRL has traded 110,816 shares today.
  • CRL traded in a range 202.1% of the normal price range with a price range of $4.01.
  • CRL traded above its daily resistance level (quality: 93 days, meaning that the stock is crossing a resistance level set by the last 93 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 CRL:

Charles River Laboratories International, Inc., an early-stage contract research company, provides drug discovery and preclinical development services worldwide. CRL has a PE ratio of 28. Currently there are 6 analysts that rate Charles River Laboratories International In a buy, 2 analysts rate it a sell, and 7 rate it a hold.

The average volume for Charles River Laboratories International In has been 391,600 shares per day over the past 30 days. Charles River Laboratories International In has a market cap of $3.6 billion and is part of the health care sector and health services industry. The stock has a beta of 0.98 and a short float of 4.1% with 3.59 days to cover. Shares are up 17% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Charles River Laboratories International In as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, reasonable valuation levels, expanding profit margins and notable return on equity. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 5.0%. Since the same quarter one year prior, revenues slightly increased by 7.0%. 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, CRL's share price has jumped by 41.21%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, CRL should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • CHARLES RIVER LABS INTL INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CHARLES RIVER LABS INTL INC increased its bottom line by earning $2.69 versus $2.15 in the prior year. This year, the market expects an improvement in earnings ($3.59 versus $2.69).
  • 42.85% is the gross profit margin for CHARLES RIVER LABS INTL INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 9.84% trails the industry average.

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