Heavy Trading On Bright Horizons Family Solutions (BFAM) Before Market Open

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 Bright Horizons Family Solutions ( BFAM) as a pre-market mover with heavy volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Bright Horizons Family Solutions as such a stock due to the following factors:

  • BFAM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $8.6 million.
  • BFAM traded 22,677 shares today in the pre-market hours as of 8:25 AM, representing 14.8% of its average daily volume.

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More details on BFAM:

Bright Horizons Family Solutions Inc. provides child care, early education, and other services for employers and families. It operates through three segments: Full-Service Center-Based Child Care, Back-Up Dependent Care, and Other Educational Advisory Services. BFAM has a PE ratio of 47. Currently there are 5 analysts that rate Bright Horizons Family Solutions a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Bright Horizons Family Solutions has been 164,800 shares per day over the past 30 days. Bright Horizons Family has a market cap of $3.4 billion and is part of the services sector and diversified services industry. The stock has a beta of 0.49 and a short float of 2.4% with 5.59 days to cover. Shares are up 16.4% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Bright Horizons Family Solutions as a buy. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, increase in net income, revenue growth, solid stock price performance and notable return on equity. We feel its 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:
  • BRIGHT HORIZONS FAMILY SOLTN has improved earnings per share by 45.8% 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. During the past fiscal year, BRIGHT HORIZONS FAMILY SOLTN increased its bottom line by earning $1.07 versus $0.15 in the prior year. This year, the market expects an improvement in earnings ($1.76 versus $1.07).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Diversified Consumer Services industry. The net income increased by 40.4% when compared to the same quarter one year prior, rising from $16.05 million to $22.53 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 7.3%. Since the same quarter one year prior, revenues slightly increased by 5.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 45.83% and other important driving factors, this stock has surged by 38.87% over the past year, outperforming the rise in the S&P 500 Index during the same period. 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 return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Diversified Consumer Services industry and the overall market, BRIGHT HORIZONS FAMILY SOLTN's return on equity is significantly below that of the industry average and is below that of the S&P 500.

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