Today's Strong And Under The Radar Stock: Marriott Vacations Worldwide (VAC)

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 Marriott Vacations Worldwide ( VAC) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Marriott Vacations Worldwide as such a stock due to the following factors:

  • VAC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $18.9 million.
  • VAC is making at least a new 3-day high.
  • VAC has a PE ratio of 31.
  • VAC is mentioned 1.35 times per day on StockTwits.
  • VAC has not yet been mentioned on StockTwits today.
  • VAC is currently in the upper 20% of its 1-year range.
  • VAC is in the upper 35% of its 20-day range.
  • VAC is in the upper 45% of its 5-day range.
  • VAC 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 VAC:

Marriott Vacations Worldwide Corporation develops, markets, sells, and manages vacation ownership and related products under the Marriott Vacation Club and Grand Residences by Marriott brands. The stock currently has a dividend yield of 1.1%. VAC has a PE ratio of 31. Currently there are 2 analysts that rate Marriott Vacations Worldwide a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Marriott Vacations Worldwide has been 171,100 shares per day over the past 30 days. Marriott Vacations Worldwide has a market cap of $2.8 billion and is part of the services sector and leisure industry. The stock has a beta of 0.76 and a short float of 2.9% with 4.75 days to cover. Shares are up 19.1% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Marriott Vacations Worldwide 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, solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. 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 7.4%. Since the same quarter one year prior, revenues rose by 13.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.57, is low and is below the industry average, implying that there has been successful management of debt levels.
  • Powered by its strong earnings growth of 90.74% and other important driving factors, this stock has surged by 55.67% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, VAC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • MARRIOTT VACATIONS WORLDWIDE reported significant earnings per share improvement 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, MARRIOTT VACATIONS WORLDWIDE increased its bottom line by earning $2.30 versus $2.17 in the prior year. This year, the market expects an improvement in earnings ($3.48 versus $2.30).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 79.2% when compared to the same quarter one year prior, rising from $19.00 million to $34.05 million.

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