Barbarian At The Gate: Expeditors International Of Washington (EXPD)

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 Expeditors International of Washington ( EXPD) 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 Expeditors International of Washington as such a stock due to the following factors:

  • EXPD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $64.1 million.
  • EXPD has traded 749,197 shares today.
  • EXPD traded in a range 229.1% of the normal price range with a price range of $1.45.
  • EXPD traded above its daily resistance level (quality: 15 days, meaning that the stock is crossing a resistance level set by the last 15 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 EXPD:

Expeditors International of Washington, Inc. provides logistics services. The stock currently has a dividend yield of 1.6%. EXPD has a PE ratio of 23. Currently there are 4 analysts that rate Expeditors International of Washington a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for Expeditors International of Washington has been 1.1 million shares per day over the past 30 days. Expeditors International of Washington has a market cap of $8.9 billion and is part of the services sector and transportation industry. The stock has a beta of 0.86 and a short float of 2.4% with 3.28 days to cover. Shares are up 4.3% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Expeditors International of Washington 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, impressive record of earnings per share growth, increase in net income and notable return on equity. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 0.5%. Since the same quarter one year prior, revenues rose by 12.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • EXPD has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, EXPD has a quick ratio of 2.34, which demonstrates the ability of the company to cover short-term liquidity needs.
  • EXPEDITORS INTL WASH INC has improved earnings per share by 30.9% 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, EXPEDITORS INTL WASH INC increased its bottom line by earning $1.92 versus $1.70 in the prior year. This year, the market expects an improvement in earnings ($2.23 versus $1.92).
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Air Freight & Logistics industry average. The net income increased by 27.3% when compared to the same quarter one year prior, rising from $83.82 million to $106.70 million.
  • 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. Compared to other companies in the Air Freight & Logistics industry and the overall market on the basis of return on equity, EXPEDITORS INTL WASH INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

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