Trade-Ideas: Providence Service (PRSC) 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.

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

  • PRSC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.0 million.
  • PRSC is making at least a new 3-day high.
  • PRSC has a PE ratio of 4.
  • PRSC is mentioned 1.45 times per day on StockTwits.
  • PRSC has not yet been mentioned on StockTwits today.
  • PRSC is currently in the upper 20% of its 1-year range.
  • PRSC is in the upper 35% of its 20-day range.
  • PRSC is in the upper 45% of its 5-day range.
  • PRSC 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 PRSC:

The Providence Service Corporation provides and manages government sponsored non-emergency transportation services (NET Services), human services, workforce development services (WD Services), and health assessment services (HA Services) in the United States and Canada. PRSC has a PE ratio of 4. Currently there is 1 analyst that rates Providence Service a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Providence Service has been 131,400 shares per day over the past 30 days. Providence Service has a market cap of $798.4 million and is part of the health care sector and health services industry. The stock has a beta of 0.12 and a short float of 5% with 7.34 days to cover. Shares are up 36.6% year-to-date as of the close of trading on Thursday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Providence Service as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, feeble growth in the company's earnings per share and unimpressive growth in net income.

Highlights from the ratings report include:

  • PRSC's very impressive revenue growth greatly exceeded the industry average of 13.1%. Since the same quarter one year prior, revenues leaped by 74.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has significantly increased by 95.99% to $15.38 million when compared to the same quarter last year. In addition, PROVIDENCE SERVICE CORP has also vastly surpassed the industry average cash flow growth rate of 0.85%.
  • PROVIDENCE SERVICE CORP's earnings per share declined by 27.3% in the most recent quarter compared to the same quarter a year ago. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, PROVIDENCE SERVICE CORP reported lower earnings of $1.37 versus $1.41 in the prior year. This year, the market expects earnings to be in line with last year ($1.37 versus $1.37).
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. When compared to other companies in the Health Care Providers & Services industry and the overall market, PROVIDENCE SERVICE CORP's return on equity is below that of both the industry average and the S&P 500.

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Today's Strong And Under The Radar Stock: Providence Service (PRSC)

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Providence Service (PRSC) Highlighted As Strong And Under The Radar Stock Of The Day

Providence Service (PRSC) Highlighted As Strong And Under The Radar Stock Of The Day