Brookdale Senior Living (BKD) Marked As A Barbarian At The Gate

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 Brookdale Senior Living ( BKD) 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 Brookdale Senior Living as such a stock due to the following factors:

  • BKD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $45.3 million.
  • BKD has traded 99,234 shares today.
  • BKD traded in a range 245.1% of the normal price range with a price range of $1.79.
  • BKD traded above its daily resistance level (quality: 1 day, meaning that the stock is crossing a resistance level set by the last 1 calendar day. 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 BKD with the Ticky from Trade-Ideas. See the FREE profile for BKD NOW at Trade-Ideas

More details on BKD:

Brookdale Senior Living Inc. owns and operates senior living communities in the United States. It operates in six segments: Retirement Centers, Assisted Living, Continuing Care Retirement Communities (CCRCs) Rental, CCRCs Entry Fee, Brookdale Ancillary Services, and Management Services. Currently there are 4 analysts that rate Brookdale Senior Living a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Brookdale Senior Living has been 1.9 million shares per day over the past 30 days. Brookdale Senior Living has a market cap of $3.9 billion and is part of the health care sector and health services industry. The stock has a beta of 2.55 and a short float of 10.1% with 5.95 days to cover. Shares are up 14.3% 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 Brookdale Senior Living as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and poor profit margins.

Highlights from the ratings report include:
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • BROOKDALE SENIOR LIVING INC reported significant earnings per share improvement 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. This trend suggests that the performance of the business is improving. During the past fiscal year, BROOKDALE SENIOR LIVING INC continued to lose money by earning -$0.03 versus -$0.55 in the prior year. This year, the market expects an improvement in earnings ($0.32 versus -$0.03).
  • The gross profit margin for BROOKDALE SENIOR LIVING INC is rather low; currently it is at 21.07%. Regardless of BKD's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of -0.13% trails the industry average.
  • The debt-to-equity ratio is very high at 2.58 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.23, which clearly demonstrates the inability to cover short-term cash needs.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
null

If you liked this article you might like

These Stocks Are Ready to Reverse Course

The 10% Pop in H&R Block Has Nothing to Do With the Fed

Fed Has Nothing to Do With the 10% Pop in H&R Block

Analysts' Actions -- Adobe, Starbucks, Snap, KB Home and More

Brookdale Is Exploring Its Options