Trade-Ideas: SBA Communications (SBAC) Is Today's Pre-Market Leader Stock

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 SBA Communications ( SBAC) as a pre-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified SBA Communications as such a stock due to the following factors:

  • SBAC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $409.1 million.
  • SBAC traded 46,020 shares today in the pre-market hours as of 8:35 AM.
  • SBAC is up 277.7% today from Friday's close.

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More details on SBAC:

SBA Communications Corporation owns and operates wireless communications towers in the United States, Canada, Costa Rica, El Salvador, Guatemala, Nicaragua, Panama, and Brazil. Currently there are 12 analysts that rate SBA Communications a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for SBA Communications has been 1.4 million shares per day over the past 30 days. SBA has a market cap of $9.9 billion and is part of the services sector and diversified services industry. The stock has a beta of 0.62 and a short float of 11.3% with 10.45 days to cover. Shares are up 9.1% year to date as of the close of trading on Friday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates SBA Communications as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and increase in net income. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and generally higher debt management risk.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 2.0%. Since the same quarter one year prior, revenues rose by 41.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • SBA COMMUNICATIONS CORP has improved earnings per share by 37.8% in the most recent quarter compared to the same quarter a year ago. 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, SBA COMMUNICATIONS CORP reported poor results of -$1.50 versus -$1.14 in the prior year. This year, the market expects an improvement in earnings (-$0.76 versus -$1.50).
  • The debt-to-equity ratio is very high at 12.95 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, SBAC's quick ratio is somewhat strong at 1.48, demonstrating the ability to handle short-term liquidity needs.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Wireless Telecommunication Services industry and the overall market, SBA COMMUNICATIONS CORP's return on equity significantly trails that of both the industry average and the S&P 500.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
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