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 Mednax as such a stock due to the following factors:
- MD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $37.6 million.
- MD has traded 296,702 shares today.
- MD traded in a range 203.1% of the normal price range with a price range of $2.21.
- MD traded above its daily resistance level (quality: 189 days, meaning that the stock is crossing a resistance level set by the last 189 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 MD:
MEDNAX, Inc., together with its subsidiaries, provides newborn, anesthesia, maternal-fetal, and other pediatric subspecialties care physician services in the United States and Puerto Rico. MD has a PE ratio of 19.1. Currently there are 9 analysts that rate Mednax a buy, no analysts rate it a sell, and 4 rate it a hold.
The average volume for Mednax has been 577,800 shares per day over the past 30 days. Mednax has a market cap of $5.7 billion and is part of the health care sector and health services industry. The stock has a beta of 0.93 and a short float of 6.7% with 10.46 days to cover. Shares are up 6.1% year-to-date as of the close of trading on Wednesday.
rates Mednax as a
. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, increase in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
Highlights from the ratings report include:
- MEDNAX INC has improved earnings per share by 15.3% 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, MEDNAX INC increased its bottom line by earning $2.78 versus $2.42 in the prior year. This year, the market expects an improvement in earnings ($3.15 versus $2.78).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Health Care Providers & Services industry average. The net income increased by 14.2% when compared to the same quarter one year prior, going from $69.22 million to $79.02 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 19.5%. Since the same quarter one year prior, revenues rose by 12.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
- MD's debt-to-equity ratio is very low at 0.07 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.34, which illustrates the ability to avoid short-term cash problems.
- Net operating cash flow has slightly increased to $134.24 million or 5.50% when compared to the same quarter last year. In addition, MEDNAX INC has also modestly surpassed the industry average cash flow growth rate of 5.46%.
- You can view the full Mednax Ratings Report.