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 Gartner as such a stock due to the following factors:
- IT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $40.4 million.
- IT has traded 144,992 shares today.
- IT traded in a range 209.5% of the normal price range with a price range of $2.80.
- IT traded above its daily resistance level (quality: 1 day, meaning that the stock is crossing a resistance level set by the last 1 calendar day. 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 IT with the Ticky from Trade-Ideas. See the FREE profile for IT NOW at Trade-Ideas
More details on IT:
Gartner, Inc. provides independent and objective research and analysis on the information technology (IT), computer hardware, software, communications, and related technology industries in the United States, Canada, Europe, the Middle East, Africa, and internationally. IT has a PE ratio of 36.0. Currently there are 4 analysts that rate Gartner a buy, no analysts rate it a sell, and 5 rate it a hold.
The average volume for Gartner has been 518,400 shares per day over the past 30 days. Gartner has a market cap of $6.3 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.00 and a short float of 2.8% with 3.27 days to cover. Shares are down 1.5% year-to-date as of the close of trading on Thursday.
rates Gartner as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, growth in earnings per share, increase in net income and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 16.3%. Since the same quarter one year prior, revenues slightly increased by 9.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- GARTNER INC has improved earnings per share by 5.3% 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, GARTNER INC increased its bottom line by earning $1.92 versus $1.73 in the prior year. This year, the market expects an improvement in earnings ($2.11 versus $1.92).
- The net income growth from the same quarter one year ago has significantly exceeded that of the IT Services industry average, but is less than that of the S&P 500. The net income increased by 2.9% when compared to the same quarter one year prior, going from $36.68 million to $37.74 million.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the IT Services industry and the overall market, GARTNER INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- The gross profit margin for GARTNER INC is rather high; currently it is at 61.76%. 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 8.44% trails the industry average.
- You can view the full Gartner Ratings Report.