Strong And Under The Radar Today: Blackbaud (BLKB)

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.

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

  • BLKB has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $11.2 million.
  • BLKB is making at least a new 3-day high.
  • BLKB has a PE ratio of 80.2.
  • BLKB is mentioned 1.10 times per day on StockTwits.
  • BLKB has not yet been mentioned on StockTwits today.
  • BLKB is currently in the upper 20% of its 1-year range.
  • BLKB is in the upper 35% of its 20-day range.
  • BLKB is in the upper 45% of its 5-day range.
  • BLKB 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 BLKB:

Blackbaud, Inc. provides software solutions and related services for nonprofit, charitable giving, and education communities worldwide. The stock currently has a dividend yield of 0.9%. BLKB has a PE ratio of 80.2. Currently there is 1 analyst that rates Blackbaud a buy, 1 analyst rates it a sell, and none rate it a hold.

The average volume for Blackbaud has been 186,300 shares per day over the past 30 days. Blackbaud has a market cap of $2.4 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 0.82 and a short float of 10% with 13.83 days to cover. Shares are up 18.7% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Blackbaud as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income, expanding profit margins, solid stock price performance and growth in earnings per share. 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:
  • The revenue growth came in higher than the industry average of 0.6%. Since the same quarter one year prior, revenues rose by 17.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Software industry. The net income increased by 12.3% when compared to the same quarter one year prior, going from $3.81 million to $4.29 million.
  • The gross profit margin for BLACKBAUD INC is rather high; currently it is at 61.05%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, BLKB's net profit margin of 2.84% significantly trails the industry average.
  • 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 65.94% 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.
  • BLACKBAUD INC has improved earnings per share by 12.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, BLACKBAUD INC reported lower earnings of $0.61 versus $0.68 in the prior year. This year, the market expects an improvement in earnings ($1.43 versus $0.61).

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