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 Expedia ( EXPE) 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 Expedia as such a stock due to the following factors:
- EXPE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $102.7 million.
- EXPE has traded 2.3 million shares today.
- EXPE traded in a range 231.3% of the normal price range with a price range of $2.67.
- EXPE traded above its daily resistance level (quality: 150 days, meaning that the stock is crossing a resistance level set by the last 150 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. EXCLUSIVE OFFER: Get the inside scoop on opportunities in EXPE with the Ticky from Trade-Ideas. See the FREE profile for EXPE NOW at Trade-Ideas More details on EXPE: Expedia, Inc., together with its subsidiaries, operates as an online travel company in the United States and internationally. The stock currently has a dividend yield of 0.9%. EXPE has a PE ratio of 62.0. Currently there are 6 analysts that rate Expedia a buy, no analysts rate it a sell, and 11 rate it a hold. The average volume for Expedia has been 3.2 million shares per day over the past 30 days. Expedia has a market cap of $7.4 billion and is part of the services sector and leisure industry. The stock has a beta of -0.13 and a short float of 14.1% with 8.07 days to cover. Shares are up 1.4% year-to-date as of the close of trading on Wednesday. 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 Expedia as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, attractive valuation levels, expanding profit margins, growth in earnings per share and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income. Highlights from the ratings report include:
- EXPE's revenue growth has slightly outpaced the industry average of 7.4%. Since the same quarter one year prior, revenues rose by 16.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The gross profit margin for EXPEDIA INC is currently very high, coming in at 84.07%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 12.18% is above that of the industry average.
- EXPEDIA INC's earnings per share improvement from the most recent quarter was slightly positive. 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, EXPEDIA INC reported lower earnings of $2.16 versus $2.34 in the prior year. This year, the market expects an improvement in earnings ($3.15 versus $2.16).
- In its most recent trading session, EXPE has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- You can view the full Expedia Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.