Trade-Ideas: Express Scripts (ESRX) Is Today's Unusual Social Activity 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 Express Scripts ( ESRX) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified Express Scripts as such a stock due to the following factors:

  • ESRX has more that 20x the normal benchmarked social activity for this time of the day compared to its average of 1.67 mentions/day.
  • ESRX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $351.0 million.

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.

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More details on ESRX:

Express Scripts Holding Company provides a range of pharmacy benefit management (PBM) services primarily in the United States and Canada. It offers healthcare management and administration services on behalf of its clients. ESRX has a PE ratio of 33.2. Currently there are 13 analysts that rate Express Scripts a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Express Scripts has been 4.3 million shares per day over the past 30 days. Express Scripts has a market cap of $61.8 billion and is part of the health care sector and health services industry. The stock has a beta of 1.54 and a short float of 1.9% with 3.37 days to cover. Shares are up 9.2% 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 Express Scripts as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, reasonable valuation levels, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and growth in earnings per share. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 38.19% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, ESRX should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Net operating cash flow has increased to $1,036.30 million or 30.64% when compared to the same quarter last year. In addition, EXPRESS SCRIPTS HOLDING CO has also vastly surpassed the industry average cash flow growth rate of -46.42%.
  • The current debt-to-equity ratio, 0.60, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that ESRX's debt-to-equity ratio is low, the quick ratio, which is currently 0.61, displays a potential problem in covering short-term cash needs.
  • EXPRESS SCRIPTS HOLDING CO has improved earnings per share by 8.0% 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, EXPRESS SCRIPTS HOLDING CO reported lower earnings of $1.85 versus $2.52 in the prior year. This year, the market expects an improvement in earnings ($4.32 versus $1.85).

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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