Bull Of The Day: AMN Healthcare

When I first stumbled across today’s Bull of the Day I had to sit back and smile for a second. The company sits right in the middle of a two hot spots in the economy. The job market is strong so staffing companies are doing well and healthcare stocks have been booming. This company is the perfect match of the two.

But more than that, this stock popped up on a weekly screen I run to find the top momentum stocks in the market. It’s a simple screen really that looks for stocks that are Zacks Rank #1 (Strong Buy) and Zacks Rank #2 (Buy), have Momentum Style Scores of “A” or “B” and are breaking out to fresh 52-week highs. This stock has it all.

Today’s Bull of the Day, AMN Healthcare Services (AHS - Snapshot Report) is a travel healthcare staffing company. It recruits and places nurses, physicians, and other healthcare professionals in travel or permanent assignments in acute-care facilities, physician practice groups, and other healthcare facilities. The Company's professionals include RNs, surgical technologists, nurse practitioners, respiratory therapists, radiology technologists, rehab professionals, and therapy assistants.

Analysts have been bullish on the stock as well, pushing up their earnings estimates for the current quarter, next quarter, current year, and next year over the last week. Probably for good reason too as the company has surprised earnings to the upside by an average of 6 cents over the last four quarters. The most recent earnings beat came in at 38 cents versus consensus estimates of 30 cents.

The bullish attitude has increased consensus for the current year from $1.20 to $1.36. Not to fall behind, next year’s consensus has now increased from $1.36 to $1.51. Basically that puts AHS a year ahead of scheduled growth. No wonder the stock is breaking out to new highs.

The climb in AHS shares has been slow and steady. There haven’t been many huge gaps upward or painful reversions to the mean. It’s been a smooth increase from the lows near $10 in May 2014 to the highs above $36. The last few days following the big earnings beat have provided the buyers some time to take a breather. The gap on earnings started at the previous highs near $32. With shares barely coming down to $34 you can’t deny the bullish trend the stock is locked into right now. An overbought commodity channel index is a small warning signal but there have been many months where the CCI has remained at or above 100 while the stock continues to run.