Watch Out: Barbarians At The Gate For DISH Network (DISH)

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 DISH Network ( DISH) 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 DISH Network as such a stock due to the following factors:

  • DISH has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $180.3 million.
  • DISH has traded 5.6 million shares today.
  • DISH traded in a range 201.8% of the normal price range with a price range of $2.68.
  • DISH traded above its daily resistance level (quality: 8 days, meaning that the stock is crossing a resistance level set by the last 8 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 DISH:

DISH Network Corporation, together with its subsidiaries, offers direct broadcast satellite subscription television services in the United States. DISH has a PE ratio of 34.5. Currently there are 5 analysts that rate DISH Network a buy, 3 analysts rate it a sell, and 8 rate it a hold.

The average volume for DISH Network has been 2.5 million shares per day over the past 30 days. DISH Network has a market cap of $12.0 billion and is part of the services sector and media industry. The stock has a beta of 0.43 and a short float of 3.7% with 2.44 days to cover. Shares are down 6.6% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates DISH Network as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and generally higher debt management risk.

Highlights from the ratings report include:
  • DISH's revenue growth has slightly outpaced the industry average of 2.3%. Since the same quarter one year prior, revenues slightly increased by 2.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Media industry. The net income increased by 298.7% when compared to the same quarter one year prior, rising from -$158.46 million to $314.91 million.
  • DISH NETWORK CORP reported significant earnings per share improvement 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, DISH NETWORK CORP reported lower earnings of $1.41 versus $3.38 in the prior year. This year, the market expects an improvement in earnings ($1.53 versus $1.41).
  • The debt-to-equity ratio is very high at 20.13 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Despite the company's weak debt-to-equity ratio, the company has managed to keep a very strong quick ratio of 2.86, which shows the ability to cover short-term cash needs.
  • Net operating cash flow has decreased to $401.05 million or 41.53% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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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