Watch Out: Barbarians At The Gate For Comcast (CMCSA)

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 Comcast ( CMCSA) 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 Comcast as such a stock due to the following factors:

  • CMCSA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $1.1 billion.
  • CMCSA has traded 629,613 shares today.
  • CMCSA traded in a range 249.3% of the normal price range with a price range of $3.07.
  • CMCSA traded above its daily resistance level (quality: 536 days, meaning that the stock is crossing a resistance level set by the last 536 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 CMCSA:

Comcast Corporation operates as a media and technology company worldwide. It operates through Cable Communications, Cable Networks, Broadcast Television, Filmed Entertainment, and Theme Parks segments. The stock currently has a dividend yield of 1.6%. CMCSA has a PE ratio of 21.6. Currently there are 24 analysts that rate Comcast a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Comcast has been 10.8 million shares per day over the past 30 days. Comcast has a market cap of $118.0 billion and is part of the services sector and media industry. The stock has a beta of 1.17 and a short float of 1.3% with 1.37 days to cover. Shares are up 6.3% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Comcast as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, growth in earnings per share, increase in net income and attractive valuation levels. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • CMCSA's revenue growth has slightly outpaced the industry average of 4.8%. Since the same quarter one year prior, revenues slightly increased by 6.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 28.57% and other important driving factors, this stock has surged by 31.98% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, CMCSA should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • COMCAST CORP has improved earnings per share by 28.6% 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, COMCAST CORP increased its bottom line by earning $2.56 versus $2.29 in the prior year. This year, the market expects an improvement in earnings ($5.73 versus $2.56).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Media industry average. The net income increased by 26.0% when compared to the same quarter one year prior, rising from $1,518.00 million to $1,913.00 million.

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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