With the Dow breaking on through 18,000, it’s easy to be bullish on the market. The American consumer is back, oil prices are cheap, and we’re looking forward to a year full of winners for 2015. With today’s Bull of the Day, I wanted to find a stock that can benefit from a continued rebound in the US. As unemployment continues to creep lower and higher paying jobs start popping up, the country is looking forward to good times ahead. I wanted to find us a stock in an industry that would benefit from this boom.
Today’s pick is in the staffing industry that currently sits in the Top 5% of our Zacks Industry Rank. Cross Country Healthcare (NASDAQ:CCRN) is a Zacks Rank #1 (Strong Buy) with a great chart that’s breaking out to the upside. CCRN is a leader in healthcare staffing with a primary focus on providing nurse and allied and physician staffing services to the healthcare market.
Three analyst estimate revisions to the upside for the current quarter and next year are a big reason why the stock is a Zacks Rank #1 (Strong Buy). The bullish adjustments have pushed consensus for the current quarter up from 3 cents to 5 cents and for the next year up from 28 cents to 31 cents.
Adding to the revisions is the fact that the company has surprised to the upside the last two quarters. Q2 numbers saw a 2 cent beat with the company turning a 1 cent profit while Q3 beat by 5 cents at 7 cents per share. The company reports Q4 earnings on March 16th, 2015.
After reaching a fresh 52-week high of $11.54 on January 28, 2014, CCRN lost momentum and the stock retreated. The first close below the 25×5 happened on February 5th as the stock also broke $10. From there, a small consolidation was followed by a disastrous sell-off on heavy volume March 6th. Over 2 million shares traded hands on what turned out to be the busiest day of the year for the stock as it shed over 20% on the session.
A steady downtrend ensued and CCRN saw any attempt to rebound thwarted below the downward sloping 25×5. Over the period from March through May, CCRN remained heavily oversold. Stochastics lingered below 20 for most of that time and the Commodity Channel Index barely ever broke above zero.
That all changed in June when a three day rally broke Cross Country Healthcare out of its malaise. A rally began that’s seen the stock come down to rest the 25×5 only on a few occasions. The pullbacks have been brief and shallow along the way with the most violent of which being an intraday move August 27th that saw the stock trade down to $6.73 before rallying later in the session to close well above $8.
Good jobs data may be helping the stock along and the last couple weeks we’ve seen some remarkable moves. After getting down to $10.50 on Tuesday the 16th, CCRN has rallied considerably and after the huge day it had Monday, is now trading within a few ticks of its 52-week high. Volume has remained relatively light the last couple of days except Monday saw a big jump in shares traded with 900k trading hands.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, Zacks Equity Research has a total average return of 1.2% and a 58.1% success rate. Zacks is ranked #1057 out of 3442 analysts.