Watch Out: Barbarians At The Gate For GasLog (GLOG)

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 GasLog ( GLOG) 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 GasLog as such a stock due to the following factors:

  • GLOG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $23.5 million.
  • GLOG has traded 445,937 shares today.
  • GLOG traded in a range 236.1% of the normal price range with a price range of $1.64.
  • GLOG traded above its daily resistance level (quality: 17 days, meaning that the stock is crossing a resistance level set by the last 17 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 GLOG:

GasLog Ltd., together with its subsidiaries, owns, operates, and manages vessels in the liquefied natural gas (LNG) market worldwide. It provides maritime services for the transportation of LNG and LNG vessel management services. The stock currently has a dividend yield of 2%. GLOG has a PE ratio of 26.6. Currently there are 3 analysts that rate GasLog a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for GasLog has been 1.3 million shares per day over the past 30 days. GasLog has a market cap of $2.0 billion and is part of the services sector and transportation industry. The stock has a beta of 1.16 and a short float of 2.8% with 2.71 days to cover. Shares are up 39.3% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates GasLog as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations, solid stock price performance and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • GLOG's very impressive revenue growth greatly exceeded the industry average of 3.5%. Since the same quarter one year prior, revenues leaped by 122.3%. 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 112.49% to $45.70 million when compared to the same quarter last year. In addition, GASLOG LTD has also vastly surpassed the industry average cash flow growth rate of -5.22%.
  • Compared to its closing price of one year ago, GLOG's share price has jumped by 69.37%, exceeding the performance of the broader market during that same time frame. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • The gross profit margin for GASLOG LTD is currently very high, coming in at 73.90%. Regardless of GLOG's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 2.01% trails the industry average.
  • GASLOG LTD has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, GASLOG LTD increased its bottom line by earning $0.90 versus $0.07 in the prior year. For the next year, the market is expecting a contraction of 13.3% in earnings ($0.78 versus $0.90).

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Strong On High Volume: GasLog (GLOG)

Strong On High Volume: GasLog (GLOG)