3 Strong ROC Stocks to Buy. Part 2

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Jan 14, 2015

From my watch list, I take these three companies with good ROC that everyone should double-check.

1)Aetna Inc.(AET)

Description: The company offers traditional, voluntary and consumer-directed health insurance products and related services, including medical, pharmacy, dental, behavioral health, group life and disability plans, medical management capabilities, Medicaid health care management services, Medicare Advantage and Medicare supplement plans, workers' compensation administrative services and health information technology products and services, such as Accountable Care Solutions.

Ratios: Aetna has a ROC of about 600%, that is not the best ratio the company ever had during his history. A Return on Assets is just 4% but this is a standard for this company as well as ROE, that has an average ratio of 15%.

Ratios of AETNA can be ranked as the top of Global Helath Care Plans sector

Financials: The company has a steady financial situation that, compared to industry, is pretty good.

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Growth: Over the last five years, the company had a steady growth rate (per share).

Revenue : +14%

EBITDA : +15%

Free Cash Flow : +6%

BookValue : +14%

All of the above are almost the same even for the last 10 years.

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Price: The stock is trading at about $90. The Peter Lynch value gives a price of $118. The DCF value gives a price of $92.

Currently, the price is at the all-time highest level. Down 1% from its 52-week high and up 40% from its 52-week low.

The 200-days Moving Average price is 80$

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Technically, AET is into an up-trend and there are no reversal patterns coming soon.

Dividend Yeld: Aetna has a small dividend yield of 0.99%. Anyway the growth rate is steady and very strong.

On the last 10 years the growth rate is 58%, but the ratio of 0.99% doesn’t sound so much interesting for a dividend-based portfolio.

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2) HCI Group Inc.(HCI)

Description: The company, through its subsidiaries provides property and casualty insurance.

Ratios: HCI Group Inc. has steady ratios so far. A ROC of 800 %, a Return on Equity of 37% and a Return on Assets of 11%.

Compared with other companies of Global Insurance – Property & Casualtysector, these ratios are better then 97% of HCI Group competitors.

Despite these amazing returns, the company had better results in the past, but the current situation is still something that cannot be ignored.

Financials: The company has a Cash To Debt ratio of 2.36 and a financial Strength of 8 out of 10.

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Growth: Over the last five years, the company had a steady growth rate (per share).

Revenue : +22%

EBITDA : +50%

BookValue : +10%

There are some problems on the Free Cash Flow growth rate, and you should investigate more before making a decision.

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Price: The stock is trading at about $44. The Peter Lynch chart gives a price of $97.3. The DCF value gives a price of $80.

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Currently, the price is down 15% from its 52-week high and up 31% from its 52-week low.

Current quotation is almost in the middle of the sea. The Moving Average gives a price of 41$.

Dividend Yeld: HCI Group has a dividend yield of 2.49%.

On the last 3 years the growth rate is 111% and since the last year it raised of 22%

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3)Winmark Corp (WINA)

Description: The company has two reportable business segments, franchising and leasing. The franchising segment franchises value-oriented retail store concepts that buy, sell, trade and consign merchandise. The leasing segment includes: Winmark Capital Corporation, its middle-market equipment leasing business; and Wirth Business Credit, Inc., its small-ticket financing business.

Ratios: Winmark Corp has strong and steady ratios. A ROC of 2200%, a Return on Equity of 80% and a Return on Assets of 38%.

These levels are the best of the Global Specialty Retail and the all-time high for Winmark Corp.

Financials: The company has a Cash To Debt of 1.12 and a financial strength of 9 out of 10

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Growth: Over the last five years, the company had a small growth rate (per share).

Revenue : +11%

EBITDA : +24%

BookValue : +17%

EPS of the last 3 Years : +20%

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Price: The stock is trading at about $80. The Peter Lynch value gives a price of $53. The DCF value gives a price of $103.

Currently, the price is down 7% from its 52-week high and up 28% from its 52-week low.

The moving average is at $74.

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Technically, the price is closer to a double top, so I suggest waiting some weeks and see what happens before opening a position.

Dividend Yeld: WINA has a small dividend yield of 0.29%

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