Trade-Ideas: Applied Industrial Technologies (AIT) Is Today's Strong And Under The Radar Stock

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

  • AIT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $8.4 million.
  • AIT has traded 1.970099999999999962341235004714690148830413818359375 options contracts today.
  • AIT is making at least a new 3-day high.
  • AIT has a PE ratio of 58.
  • AIT is mentioned 0.23 times per day on StockTwits.
  • AIT has not yet been mentioned on StockTwits today.
  • AIT is currently in the upper 20% of its 1-year range.
  • AIT is in the upper 35% of its 20-day range.
  • AIT is in the upper 45% of its 5-day range.
  • AIT 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 AIT:

Applied Industrial Technologies, Inc. distributes industrial products in the United States, Canada, Mexico, Australia, and New Zealand. The company offers its products for maintenance, repair, and operational needs, as well as original equipment manufacturing applications. The stock currently has a dividend yield of 2.4%. AIT has a PE ratio of 58. Currently there are no analysts that rate Applied Industrial Technologies a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Applied Industrial Technologies has been 205,400 shares per day over the past 30 days. Applied Industrial has a market cap of $1.8 billion and is part of the services sector and wholesale industry. The stock has a beta of 0.87 and a short float of 2.6% with 4.70 days to cover. Shares are up 13.9% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Applied Industrial Technologies as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • 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. To add to this, AIT has a quick ratio of 1.65, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Net operating cash flow has significantly increased by 50.54% to $57.42 million when compared to the same quarter last year. In addition, APPLIED INDUSTRIAL TECH INC has also vastly surpassed the industry average cash flow growth rate of -1.95%.
  • AIT, with its decline in revenue, slightly underperformed the industry average of 2.6%. Since the same quarter one year prior, revenues slightly dropped by 6.9%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • APPLIED INDUSTRIAL TECH INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, APPLIED INDUSTRIAL TECH INC increased its bottom line by earning $2.82 versus $2.67 in the prior year. For the next year, the market is expecting a contraction of 11.7% in earnings ($2.49 versus $2.82).

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