Perilous Reversal Stock: Bio-Reference Laboratories (BRLI)

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 Bio-Reference Laboratories ( BRLI) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Bio-Reference Laboratories as such a stock due to the following factors:

  • BRLI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $68.8 million.
  • BRLI has traded 185,017 shares today.
  • BRLI is down 3% today.
  • BRLI was up 5.8% yesterday.

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More details on BRLI:

Bio-Reference Laboratories, Inc. provides clinical laboratory testing services for the detection, diagnosis, evaluation, monitoring, and treatment of diseases in the United States. BRLI has a PE ratio of 22. Currently there are no analysts that rate Bio-Reference Laboratories a buy, 1 analyst rates it a sell, and 1 rates it a hold.

The average volume for Bio-Reference Laboratories has been 376,400 shares per day over the past 30 days. Bio-Reference has a market cap of $1.1 billion and is part of the health care sector and health services industry. The stock has a beta of 0.02 and a short float of 19.3% with 2.90 days to cover. Shares are up 23.3% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Bio-Reference Laboratories as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, expanding profit margins and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:
  • BRLI's revenue growth has slightly outpaced the industry average of 13.2%. Since the same quarter one year prior, revenues rose by 15.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • BRLI's debt-to-equity ratio is very low at 0.17 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, BRLI has a quick ratio of 1.97, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 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 Health Care Providers & Services industry and the overall market, BIO REFERENCE LABS's return on equity exceeds that of both the industry average and the S&P 500.
  • 45.36% is the gross profit margin for BIO REFERENCE LABS which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 3.17% is above that of the industry average.
  • Net operating cash flow has significantly increased by 465.44% to $10.06 million when compared to the same quarter last year. In addition, BIO REFERENCE LABS has also vastly surpassed the industry average cash flow growth rate of 0.72%.

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