Interested in gaining exposure to services companies? Company liquidity is an important consideration in any stock analysis. Liquidity gives a company the ability to make big acquisitions if it sees investment opportunities, a cushion for future lulls in demand, and most importantly, it keeps a company's doors open. Are these the types of stocks that you're looking for? Do you prefer stocks with high projected earnings over the next year? We ran a screen you might find helpful.
The Current ratio is a liquidity ratio used to determine a company's financial health. The metric illustrates how easily a firm can pay back its short obligations all at once through current assets. A company that has a current ratio of one or less is generally a liquidity red flag. Now this doesn't mean the company will go bankrupt tomorrow, but it also doesn't bode well for the company, and may indicate that it could have an issue paying back upcoming obligations.
The Quick ratio measures a company's ability to use its cash or assets to extinguish its current liabilities immediately. Quick assets include assets that presumably can be converted to cash at close to their book values. A company with a Quick Ratio of less than 1 cannot currently pay back its current liabilities. The quick ratio is more conservative than the Current Ratio because it excludes inventory from current assets, since some companies have difficulty turning their inventory into cash. If short-term obligations need to be paid off immediately, sometimes the current ratio would overestimate a company's short-term financial strength. In general, the higher the ratio, the greater the company's liquidity (i.e., the better able to meet current obligations using liquid assets).
EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. The 1-Year Expected EPS Growth Rate is an annual growth estimate, where the growth projections are made by analysts, the company or other credible sources.
We first looked for services stocks. From here, we then looked for companies that have strong liquidity (Current Ratio>2)(Quick Ratio>2). We then looked for businesses that are considered high-growth, with 1-year projected EPS growth above 25%. We did not screen out any market caps.
Do you think these stocks will go up in valuation? Use our list to help with your own analysis.
1) Hyatt Hotels Corporation (NYSE:H)
Hyatt Hotels Corporation has a Current Ratio of 2.89 and Quick Ratio of 2.73 and 1-Year Projected Earnings Per Share Growth Rate of 49.23%. The short interest was 3.71% as of 05/28/2012. Hyatt Hotels Corporation and its subsidiaries engage in the management, franchising, ownership, and development of Hyatt-branded hotels, resorts, and residential and vacation ownership properties worldwide. As of March 31, 2012, its portfolio consisted of 488 properties in 45 countries worldwide. The company operates its hotels under the Hyatt, Park Hyatt, Andaz, Grand Hyatt, Hyatt Regency, Hyatt Place, Hyatt House, Hyatt Residences, and Hyatt Vacation Club brands.
2) Builders FirstSource, Inc. (NASDAQ:BLDR)
|Industry:||Home Improvement Stores|
Builders FirstSource, Inc. has a Current Ratio of 3.42 and Quick Ratio of 2.56 and 1-Year Projected Earnings Per Share Growth Rate of 74.20%. The short interest was 3.88% as of 05/28/2012. Builders FirstSource, Inc. engages in the manufacture and supply of structural and related building products for residential new construction primarily in the southern and eastern United States. The company offers prefabricated components, including floor trusses, roof trusses, wall panels, stairs, and engineered wood; and window and door products, such as aluminum and vinyl windows, and pre-hung interior and exterior doors, as well as assembles and distributes interior and exterior door units. It also provides lumber and lumber sheet products comprising dimensional lumber, plywood, and oriented strand board products; millwork products, including interior trim, exterior trim, columns, and posts, as well as custom exterior featured products; and other building products, such as cabinets, gypsum, hardware, composite materials, roofing, and insulation.
3) Caribou Coffee Company, Inc. (NASDAQ:CBOU)
Caribou Coffee Company, Inc. has a Current Ratio of 3.00 and Quick Ratio of 2.06 and 1-Year Projected Earnings Per Share Growth Rate of 26.53%. The short interest was 14.22% as of 05/28/2012. Caribou Coffee Company, Inc. owns and operates coffeehouses. The company operates in three segments: Retail, Commercial, and Franchise. The Retail segment offers premium coffee and espresso-based beverages, food, specialty teas, whole bean coffee, branded merchandise, and related products.
4) Seacor Holdings Inc. (NYSE:CKH)
Seacor Holdings Inc. has a Current Ratio of 2.44 and Quick Ratio of 2.16 and 1-Year Projected Earnings Per Share Growth Rate of 55.34%. The short interest was 1.08% as of 05/28/2012. SEACOR Holdings Inc. owns, operates, invests in, and markets equipment primarily in offshore oil and gas, industrial aviation, and inland and coastal marine transportation industries worldwide. Its Offshore Marine Services segment operates support vessels to deliver cargo and personnel to offshore installations; handle anchors for drilling rigs and marine equipment; carry and launch remote operated vehicles; move personnel and supplies to offshore wind farms; support offshore construction and maintenance work; and provide accommodations for technicians and specialists, standby safety support, and emergency response services. This segment also offers shore bases, marine transport, and other supply chain management services; and supports well stimulation, seismic data gathering, and offshore accommodation projects.
5) Krispy Kreme Doughnuts, Inc. (NYSE:KKD)
Krispy Kreme Doughnuts, Inc. has a Current Ratio of 2.77 and Quick Ratio of 2.35 and 1-Year Projected Earnings Per Share Growth Rate of 29.17%. The short interest was 7.23% as of 05/28/2012. Krispy Kreme Doughnuts, Inc. operates as a branded retailer and wholesaler of doughnuts, beverages, and treats and packaged sweets worldwide. The company's doughnuts products comprise Original Glazed doughnut; cake doughnuts and crullers; and seasonal doughnuts comprising hearts, pumpkins, footballs, eggs, and snowmen, as well as honeybuns, fruit pies, mini-crullers, and chocolate products. Its beverage products consists of drip coffees, coffee-based and non-coffee-based frozen drinks, juices, sodas, milks, water, frozen/blended beverages, and packaged and fountain beverages.
6) K12, Inc. (NYSE:LRN)
|Industry:||Education & Training Services|
K12, Inc. has a Current Ratio of 3.43 and Quick Ratio of 3.18 and 1-Year Projected Earnings Per Share Growth Rate of 43.75%. The short interest was 24.96% as of 05/28/2012. K12 Inc., a technology-based education company, provides proprietary curriculum, software systems, and educational services for individualized learning for students in kindergarten through 12th grade (K12) primarily in the United States. The company's products include K12 Curriculum, which consists of online lessons, learning kits, and lesson guides; online school platform, a Web-based software platform that provides access to its online lessons, lesson planning, and scheduling tools, as well as its progress tracking tool and assessment tracking tools; and student administration management system, a proprietary student information system that stores student-specific data and is used for various functions, including enrolling students in courses, assigning progress marks and grades, tracking student demographic data, and generating student transcripts. It also offers student community tools that foster communication and interaction among families and school personnel.
7) Furmanite Corporation (NYSE:FRM)
Furmanite Corporation has a Current Ratio of 3.57 and Quick Ratio of 2.84 and 1-Year Projected Earnings Per Share Growth Rate of 92.00%. The short interest was 2.81% as of 05/28/2012. Furmanite Corporation, through its subsidiaries, provides technical services in Europe, North America, South America, Latin America, the Middle East, Africa, and the Asia Pacific. It provides on-line repairs of leaks in valves, pipes, and other components of piping systems and related equipment used in flow-process industries; and hot tapping, line stopping, line isolation, composite repair, and valve testing services. The company also provides off-line services, including on-site machining, heat treatment, and bolting and valve repair; and smart shim services, concrete repair, engineering services, valve and other products, and manufacturing.
*Company profiles were sourced from Finviz. Financial data was sourced from Finviz and Google Finance.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.