Consolidated Communications (CNSL) Is Today's Strong And Under The Radar 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 Consolidated Communications ( CNSL) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Consolidated Communications as such a stock due to the following factors:

  • CNSL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.7 million.
  • CNSL is making at least a new 3-day high.
  • CNSL has a PE ratio of 32.5.
  • CNSL is mentioned 1.03 times per day on StockTwits.
  • CNSL has not yet been mentioned on StockTwits today.
  • CNSL is currently in the upper 20% of its 1-year range.
  • CNSL is in the upper 35% of its 20-day range.
  • CNSL is in the upper 45% of its 5-day range.
  • CNSL 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 CNSL:

Consolidated Communications Holdings, Inc., together with its subsidiaries, provides a range of communications services to residential and business clients in Illinois, Texas, Pennsylvania, California, Kansas, and Missouri. The stock currently has a dividend yield of 6.1%. CNSL has a PE ratio of 32.5. Currently there are 3 analysts that rate Consolidated Communications a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Consolidated Communications has been 388,000 shares per day over the past 30 days. Consolidated has a market cap of $1.0 billion and is part of the technology sector and telecommunications industry. The stock has a beta of 1.14 and a short float of 10.4% with 10.74 days to cover. Shares are up 30.4% 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 Consolidated Communications as a buy. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, growth in earnings per share, increase in net income, notable return on equity and solid stock price performance. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the ratings report include:
  • Net operating cash flow has increased to $38.65 million or 37.75% when compared to the same quarter last year. In addition, CONSOLIDATED COMM HLDGS INC has also vastly surpassed the industry average cash flow growth rate of -22.32%.
  • CONSOLIDATED COMM HLDGS INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, CONSOLIDATED COMM HLDGS INC increased its bottom line by earning $0.74 versus $0.15 in the prior year. This year, the market expects an improvement in earnings ($0.95 versus $0.74).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Diversified Telecommunication Services industry average. The net income increased by 6.7% when compared to the same quarter one year prior, going from $9.19 million to $9.81 million.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Diversified Telecommunication Services industry and the overall market on the basis of return on equity, CONSOLIDATED COMM HLDGS INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • 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 45.20% over the past year, a rise that has exceeded that of the S&P 500 Index. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.

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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