Trade-Ideas: American Realty Capital Properties (ARCP) Is Today's Post-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 American Realty Capital Properties ( ARCP) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified American Realty Capital Properties as such a stock due to the following factors:

  • ARCP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $161.2 million.
  • ARCP is up 2.1% today from today's close.

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More details on ARCP:

American Realty Capital Properties, Inc. owns and acquires single tenant, freestanding commercial real estate that is net leased on a medium-term basis, primarily to investment grade credit rated and other creditworthy tenants. The company principally invests in retail and office properties. The stock currently has a dividend yield of 7.1%. Currently there are 4 analysts that rate American Realty Capital Properties a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for American Realty Capital Properties has been 7.5 million shares per day over the past 30 days. American has a market cap of $2.6 billion and is part of the financial sector and real estate industry. The stock has a beta of -0.21 and a short float of 31% with 4.25 days to cover. Shares are up 9.2% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates American Realty Capital Properties as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, poor profit margins and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • ARCP's very impressive revenue growth greatly exceeded the industry average of 7.3%. Since the same quarter one year prior, revenues leaped by 223.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has significantly increased by 622.25% to $16.29 million when compared to the same quarter last year. In addition, AMERICAN RLTY CAP PPTY INC has also vastly surpassed the industry average cash flow growth rate of -59.31%.
  • The gross profit margin for AMERICAN RLTY CAP PPTY INC is currently extremely low, coming in at 5.92%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, ARCP's net profit margin of -97.00% significantly underperformed when compared to the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 365.4% when compared to the same quarter one year ago, falling from -$12.69 million to -$59.06 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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