Strong And Under The Radar: Hyatt Hotels (H)

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 Hyatt Hotels ( H) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Hyatt Hotels as such a stock due to the following factors:

  • H has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $12.2 million.
  • H is making at least a new 3-day high.
  • H has a PE ratio of 44.5.
  • H is mentioned 2.00 times per day on StockTwits.
  • H has not yet been mentioned on StockTwits today.
  • H is currently in the upper 20% of its 1-year range.
  • H is in the upper 35% of its 20-day range.
  • H is in the upper 45% of its 5-day range.
  • H is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

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More details on H:

Hyatt Hotels Corporation, a hospitality company, manages, franchises, owns, and develops hotels, resorts, and residential and vacation ownership properties worldwide. H has a PE ratio of 44.5. Currently there are 9 analysts that rate Hyatt Hotels a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for Hyatt Hotels has been 299,100 shares per day over the past 30 days. Hyatt Hotels has a market cap of $2.5 billion and is part of the services sector and leisure industry. The stock has a beta of 1.64 and a short float of 2.2% with 3.47 days to cover. Shares are up 22.9% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Hyatt Hotels as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 5.6%. Since the same quarter one year prior, revenues slightly increased by 6.0%. 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.
  • H's debt-to-equity ratio is very low at 0.27 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.48, which illustrates the ability to avoid short-term cash problems.
  • Compared to its closing price of one year ago, H's share price has jumped by 36.93%, exceeding the performance of the broader market during that same time frame. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • Net operating cash flow has significantly increased by 51.11% to $204.00 million when compared to the same quarter last year. In addition, HYATT HOTELS CORP has also vastly surpassed the industry average cash flow growth rate of -5.13%.

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