Trade-Ideas LLC identified Restaurant Brands International ( QSR) 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 Restaurant Brands International as such a stock due to the following factors:

  • QSR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $40.7 million.
  • QSR has traded 1.0 million shares today.
  • QSR traded in a range 214.7% of the normal price range with a price range of $1.92.
  • QSR traded above its daily resistance level (quality: 527 days, meaning that the stock is crossing a resistance level set by the last 527 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 QSR:

Restaurant Brands International Inc. owns, operates, and franchises quick service restaurants under the Tim Hortons and Burger King brand names. It operates through two segments, Tim Hortons and Burger King. As of December 31, 2015, Restaurant Brands International Inc. The stock currently has a dividend yield of 1.3%. QSR has a PE ratio of 31. Currently there are 3 analysts that rate Restaurant Brands International a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for Restaurant Brands International has been 1.0 million shares per day over the past 30 days. Restaurant Brands International has a market cap of $10.4 billion and is part of the services sector and leisure industry. Shares are up 19.7% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Restaurant Brands International as a hold. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, impressive record of earnings per share growth and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and weak operating cash flow.

Highlights from the ratings report include:
  • 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 94.5% when compared to the same quarter one year prior, rising from $60.40 million to $117.50 million.
  • RESTAURANT BRANDS INTL INC 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 year. During the past fiscal year, RESTAURANT BRANDS INTL INC turned its bottom line around by earning $0.50 versus -$1.30 in the prior year.
  • Net operating cash flow has decreased to $183.30 million or 29.95% when compared to the same quarter last year. Despite a decrease in cash flow RESTAURANT BRANDS INTL INC is still fairing well by exceeding its industry average cash flow growth rate of -79.94%.
  • Currently the debt-to-equity ratio of 1.78 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Even though the debt-to-equity ratio is weak, QSR's quick ratio is somewhat strong at 1.07, demonstrating the ability to handle short-term liquidity needs.

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