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I have searched for highly profitable growth stocks that are in a short-term, a mid-term and a long-term uptrend. These stocks also have to show a remarkably low forward P/E ratio and very low debt.

I used the Portfolio123's powerful screener to perform the search. The screen's formula requires all stocks to comply with all following demands:

  1. The stock does not trade over-the-counter (OTC).
  2. Market cap is greater than $100 million.
  3. Price is greater than 1.00.
  4. Average annual earnings growth for the past five years is greater than 25%.
  5. Average annual earnings growth estimates for the next five years is greater than 10%.
  6. Forward P/E is less than 15.
  7. Total debt to equity is less than 0.40.
  8. The stock price is above the 20-day simple moving average (short-term uptrend).
  9. The stock price is above the 50-day simple moving average (mid-term uptrend).
  10. The stock price is above the 200-day simple moving average (long-term uptrend).
  11. The ten stocks with the highest earnings growth estimates among all the stocks that complied with the first ten demands.

As a result, ten stocks came out, as shown in the charts below (the number of stocks left after each demand can be seen in the chart). In this article, I describe the three stocks with the highest earnings growth estimates among the ten stocks. In my opinion, these stocks can reward an investor a significant capital gain. I recommend readers use this list of stocks as a basis for further research. All the data for this article were taken from Yahoo Finance, Portfolio123 and finviz.com, on November 03.

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Rank

Ticker

Name

Last Price

Market Cap $million

Industry

1

(NYSE:HCI)

HCI Group Inc

43.00

492

Insurance

2

(NYSE:CJES)

C&J Energy Services Inc

23.20

1,266

Energy Equipment & Services

3

(NASDAQ:APEI)

American Public Education Inc

39.89

704

Diversified Consumer Services

4

(NASDAQ:JOBS)

51job Inc

77.87

2,289

Professional Services

5

(NASDAQ:NNBR)

NN Inc

16.22

280

Machinery

6

(NYSEMKT:CVU)

CPI Aerostructures Inc

12.37

104

Aerospace & Defense

7

(NASDAQ:LIOX)

Lionbridge Technologies

4.77

304

IT Services

8

(NASDAQ:UTHR)

United Therapeutics

90.34

4,533

Biotechnology

9

(NYSE:LEA)

Lear Corp

77.58

6,260

Auto Components

10

(NASDAQ:AAPL)

Apple Inc

520.03

467,618

Computers & Peripherals

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HCI Group, Inc.

HCI Group, Inc., an insurance holding company, provides property and casualty insurance in Florida.

HCI Group has a very low debt (total debt to equity is only 0.26), and it has a very low trailing P/E of 9.21 and a very low forward P/E of 10.08. The price-to-cash ratio is extremely low at 1.55, and the price to free cash flow for the trailing 12 months is also very low at 4.14. The average annual earnings growth estimates for the next five years is very high at 25%. The forward annual dividend yield is at 2.56%, and the payout ratio is only 20.30%.

The HCI stock price is 2.11% above its 20-day simple moving average, 11.12% above its 50-day simple moving average and 38.56% above its 200-day simple moving average. That indicates a short-term, a mid-term and a long-term uptrend.

Analysts recommend the stock. Among the three analysts covering the stock, one rates it as a strong buy, and two rate it as a buy.

HCI Group has recorded strong revenue and EPS growth during the last year, the last three years and the last five years, as shown in the table below.

The tables below emphasize the HCI Group's superior growth rates, margins and return on capital over the industry median, the sector median and the S&P 500 median.

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Most of HCI Group's stock valuation parameters have been better than its industry median, sector median and the S&P 500 median, as shown in the table below.

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Source: Portfolio123

HCI Group will report its latest quarterly financial results on November 05. HCI is expected to post a profit of $0.62 a share, a 130% rise from the company's actual earnings for the same quarter a year ago.

On October 22, HCI Group announced that in an effort to distribute more profit among shareholders, the board of directors of HCI Group increased its dividend by 22.2%. The company will now pay a quarterly dividend of 27.50 cents per share, up from 22.50 cents paid on Sept. 23, 2013.

On August 01, HCI Group reported its second-quarter financial results, which beat EPS expectations by $0.18. The company reported income available to common stockholders in the second quarter of 2013 totaled $16.2 million or $1.40 diluted earnings per common share, an improvement from $7.2 million or $0.74 diluted earnings per common share in the second quarter of 2012. Gross premiums earned in the second quarter of 2013 increased 52.4% to $82.0 million from $53.8 million in the same period in 2012. The increase was primarily due to policies assumed from Citizens Property Insurance Corporation in November 2012.

HCI has recorded very strong revenue and EPS growth, and considering its compelling valuation metrics, and it strong earnings growth prospects, HCI stock can move higher. Furthermore, the rich dividend represents a nice income.

Main risk to HCI stock is big losses in the event of severe hurricane storms.

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Chart: finviz.com

C&J Energy Services, Inc.

C&J Energy Services, Inc. provides hydraulic fracturing, coiled tubing, wireline, and other complementary services to oil and gas exploration and production companies in the United States.

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Source: company presentation

C&J Energy Services has a low debt (total debt to equity is 0.19), and it has a low trailing P/E of 14.15 and a low forward P/E of 13.14. The PEG ratio is very low at 0.83, and the average annual earnings growth estimates for the next five years is very high at 20%.

The CJES stock price is 6.91% above its 20-day simple moving average, 8.75% above its 50-day simple moving average and 10.56% above its 200-day simple moving average. That indicates a short-term, a mid-term and a long-term uptrend.

C&J Energy Services has recorded very strong revenue and EPS growth during the last three years, and the last five years, as shown in the charts below.

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Source: company presentation

Most of C&J Energy Services' stock valuation parameters have been better than its industry median, sector median and the S&P 500 median, as shown in the table below.

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On October 30, C&J Energy Services reported its third-quarter financial results, which beat EPS expectations by $0.04 and missed on revenues. The company reported net income of $13.1 million, or $0.24 per diluted share, for the third quarter of 2013. Net income was $20.8 million, or $0.38 per diluted share, in the second quarter of 2013 and $49.3 million, or $0.91 per diluted share, in the third quarter of 2012. Second quarter 2013 results included an after-tax charge of $0.6 million ($0.01 per diluted share) associated with a non-cash inventory write-down related to a decrease in the market value of certain spare parts. Total revenue for the third quarter of 2013 was $261.9 million, a 2% decrease compared to $267.0 million for the second quarter of 2013 and a 15% decrease compared to $307.8 million for the third quarter of 2012.

C&J Energy Services has good valuation metrics and strong earnings growth prospects, and considering the fact that the stock is in an uptrend, CJES stock still has room to go up.

Risks to the expected capital gain and to the dividend payment include a downturn in the U.S. economy and a decline in the price of oil and natural gas.

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Chart: finviz.com

American Public Education, Inc.

American Public Education, Inc., together with its subsidiary, American Public University System, Inc., provides online higher education focusing on the needs of the military and public service communities.

American Public Education has no debt at all, and it has a low trailing P/E of 15.58 and a low forward P/E of 14.39. The PEG ratio is low at 1.00, and the average annual earnings growth estimates for the next five years is high at 16.2%.

The APEI stock price is 6.57% above its 20-day simple moving average, 3.87% above its 50-day simple moving average and 6.66% above its 200-day simple moving average. That indicates a short-term, a mid-term and a long-term uptrend.

American Public Education has recorded very strong revenue and EPS growth during the last year, last three years, and the last five years, as shown in the table below.

The tables below emphasize the American Public Education's superior growth rates, margins and return on capital over the industry median, the sector median and the S&P 500 median.

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American Public Education will report its latest quarterly financial results on November 05. APEI is expected to post a profit of $0.56 a share, a 6.7% decline from the company's actual earnings for the same quarter a year ago.

American Public Education has good valuation metrics and strong earnings growth prospects, and considering the fact that the stock is in an uptrend, APEI stock still has room to go up.

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Chart: finviz.com

Source: Attractively Priced Growth Stocks Currently In An Uptrend