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Trade-Ideas LLC identified

Fleetcor Technologies

(

FLT

) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified Fleetcor Technologies as such a stock due to the following factors:

  • FLT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $164.3 million.
  • FLT has a PE ratio of 36.
  • FLT is currently in the upper 30% of its 1-year range.
  • FLT is in the upper 25% of its 20-day range.
  • FLT is in the upper 35% of its 5-day range.
  • FLT is currently trading above yesterday's high.
  • FLT has experienced a gap between today's open and yesterday's close of 2.2%.

'Momo Momentum' stocks are valuable stocks to watch for a variety of reasons including historical back testing and price action. Market technicians refer to such stocks as being in a mark-up phase before a possible distribution period and price decline. Technical analysts and traders frequently find that the factors referenced above tend to create a temporary burst of strong wind in a stock's sail. Nevertheless, all successful traders must excel at maximizing gains while keeping losses to an absolute minimum. For that reason, the holding period on momo momentum stocks must always be a primary consideration, and this part of the puzzle is ultimately at the discretion of each individual's risk tolerance and portfolio risk management skills.

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TheStreet Recommends

More details on FLT:

FleetCor Technologies, Inc. provides fuel cards, commercial payment and data solutions, stored value solutions, and workforce payment products and services. FLT has a PE ratio of 36. Currently there are 7 analysts that rate Fleetcor Technologies a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Fleetcor Technologies has been 1.0 million shares per day over the past 30 days. Fleetcor has a market cap of $13.0 billion and is part of the services sector and diversified services industry. The stock has a beta of 1.46 and a short float of 3.3% with 2.93 days to cover. Shares are down 0.1% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Fleetcor Technologies as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 18.3%. Since the same quarter one year prior, revenues rose by 14.3%. 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 debt-to-equity ratio is somewhat low, currently at 0.96, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.83 is somewhat weak and could be cause for future problems.
  • 43.92% is the gross profit margin for FLEETCOR TECHNOLOGIES INC which we consider to be strong. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 12.26% trails the industry average.
  • FLEETCOR TECHNOLOGIES INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, FLEETCOR TECHNOLOGIES INC reported lower earnings of $3.85 versus $4.23 in the prior year. This year, the market expects an improvement in earnings ($6.52 versus $3.85).
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the IT Services industry. The net income has significantly decreased by 51.8% when compared to the same quarter one year ago, falling from $109.54 million to $52.83 million.

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