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 Life Time Fitness as such a stock due to the following factors:
- LTM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $36.5 million.
- LTM has traded 121,928 shares today.
- LTM traded in a range 226.8% of the normal price range with a price range of $2.48.
- LTM traded above its daily resistance level (quality: 22 days, meaning that the stock is crossing a resistance level set by the last 22 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 LTM:
Life Time Fitness, Inc. designs, builds, and operates sports and athletic, professional fitness, family recreation, and spa centers. LTM has a PE ratio of 16.6. Currently there are 5 analysts that rate Life Time Fitness a buy, no analysts rate it a sell, and 4 rate it a hold.
The average volume for Life Time Fitness has been 627,000 shares per day over the past 30 days. Life Time Fitness has a market cap of $1.9 billion and is part of the services sector and leisure industry. The stock has a beta of 1.53 and a short float of 14.3% with 7.85 days to cover. Shares are up 1.6% year-to-date as of the close of trading on Wednesday.
rates Life Time Fitness as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels, good cash flow from operations, expanding profit margins and notable return on equity. We feel these 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 7.8%. Since the same quarter one year prior, revenues slightly increased by 6.0%. 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.
- Net operating cash flow has increased to $56.00 million or 16.13% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -23.09%.
- LIFE TIME FITNESS INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. 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, LIFE TIME FITNESS INC increased its bottom line by earning $2.93 versus $2.68 in the prior year. This year, the market expects an improvement in earnings ($3.02 versus $2.93).
- 35.58% is the gross profit margin for LIFE TIME FITNESS INC which we consider to be strong. Regardless of LTM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 9.12% trails the industry average.
- You can view the full Life Time Fitness Ratings Report.