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 DaVita HealthCare Partners as such a stock due to the following factors:
- DVA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $152.9 million.
- DVA has traded 6.4 million shares today.
- DVA traded in a range 239.9% of the normal price range with a price range of $2.97.
- DVA traded above its daily resistance level (quality: 151 days, meaning that the stock is crossing a resistance level set by the last 151 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 DVA with the Ticky from Trade-Ideas. See the FREE profile for DVA NOW at Trade-Ideas
More details on DVA:
DaVita HealthCare Partners Inc. provides kidney dialysis services for patients suffering from chronic kidney failure, or end stage renal disease (ESRD) in the United States. DVA has a PE ratio of 20.9. Currently there are 7 analysts that rate DaVita HealthCare Partners a buy, no analysts rate it a sell, and 5 rate it a hold.
The average volume for DaVita HealthCare Partners has been 1.6 million shares per day over the past 30 days. DaVita HealthCare has a market cap of $12.1 billion and is part of the health care sector and health services industry. The stock has a beta of 1.13 and a short float of 3.5% with 2.59 days to cover. Shares are up 2.9% year to date as of the close of trading on Friday.
rates DaVita HealthCare Partners as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- DVA's very impressive revenue growth greatly exceeded the industry average of 9.7%. Since the same quarter one year prior, revenues leaped by 54.1%. 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.
- DAVITA HEALTHCARE PARTNERS's earnings per share declined by 14.1% in the most recent quarter compared to the same quarter a year ago. 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, DAVITA HEALTHCARE PARTNERS increased its bottom line by earning $2.73 versus $2.58 in the prior year. This year, the market expects an improvement in earnings ($3.79 versus $2.73).
- Net operating cash flow has significantly increased by 99.96% to $733.13 million when compared to the same quarter last year. Despite an increase in cash flow of 99.96%, DAVITA HEALTHCARE PARTNERS is still growing at a significantly lower rate than the industry average of 325.92%.
- In its most recent trading session, DVA has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- Currently the debt-to-equity ratio of 1.98 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Even though the debt-to-equity ratio is weak, DVA's quick ratio is somewhat strong at 1.12, demonstrating the ability to handle short-term liquidity needs.
- You can view the full DaVita HealthCare Partners Ratings Report.