Trade-Ideas LLC identified

Ultimate Software Group

(

ULTI

) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Ultimate Software Group as such a stock due to the following factors:

  • ULTI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $41.0 million.
  • ULTI has traded 181.298000000000001818989403545856475830078125 options contracts today.
  • ULTI is making at least a new 3-day high.
  • ULTI has a PE ratio of 79.
  • ULTI is mentioned 1.97 times per day on StockTwits.
  • ULTI has not yet been mentioned on StockTwits today.
  • ULTI is currently in the upper 20% of its 1-year range.
  • ULTI is in the upper 35% of its 20-day range.
  • ULTI is in the upper 45% of its 5-day range.
  • ULTI is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in ULTI with the Ticky from Trade-Ideas. See the FREE profile for ULTI NOW at Trade-Ideas

More details on ULTI:

The Ultimate Software Group, Inc. provides cloud-based human capital management solutions primarily to enterprise companies in the United States. Its UltiPro software solution delivers the functionality businesses to manage the employee life cycle from recruitment to retirement. ULTI has a PE ratio of 79. Currently there are 13 analysts that rate Ultimate Software Group a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Ultimate Software Group has been 235,400 shares per day over the past 30 days. Ultimate Software Group has a market cap of $5.9 billion and is part of the technology sector and internet industry. The stock has a beta of 1.22 and a short float of 5.9% with 8.68 days to cover. Shares are up 5.6% year-to-date as of the close of trading on Wednesday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Ultimate Software Group as a

buy

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. 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 9.9%. Since the same quarter one year prior, revenues rose by 29.2%. 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.
  • The gross profit margin for ULTIMATE SOFTWARE GROUP INC is rather high; currently it is at 64.66%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, ULTI's net profit margin of 1.30% significantly trails the industry average.
  • Net operating cash flow has increased to $32.06 million or 23.04% when compared to the same quarter last year. Despite an increase in cash flow, ULTIMATE SOFTWARE GROUP INC's average is still marginally south of the industry average growth rate of 32.91%.
  • ULTI's debt-to-equity ratio is very low at 0.03 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.16 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • ULTIMATE SOFTWARE GROUP INC's earnings per share declined by 42.9% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, ULTIMATE SOFTWARE GROUP INC reported lower earnings of $0.76 versus $1.52 in the prior year. This year, the market expects an improvement in earnings ($3.31 versus $0.76).

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.