Analyst recommendations can be a first step to determining if a stock is worth risking your hard-earned money. At any given time, there are thousands of stocks being recommended, and each for different reasons. The ones on this list have current ratios over 3, quick ratios over 2 and analyst recommendations of buy.
The current ratio indicates the company’s ability to meet short term debt and other obligations – the higher, the better. A value over 1 means its current assets are worth at least as much as its current liabilities. The quick ratio, or acid test, is much the same only current inventories are subtracted from the company’s current assets before looking at its current liabilities in proportion. Again, the higher the better. The target for this metric will vary considerably between industries but, for the most part, a quick ratio of at least 1 is acceptable.
Cash America International Inc (CSH) is a $1.54B market cap credit services company with a forward P/E ratio of 10.32. CSH has the highest current ratio of the companies we looked at, coming in at 5.51. It also has a high quick ratio of 4.38. CSH has returned 42.64% YTD and has a beta of 1.40. It recently traded at $53.04, 49.74% above its 52-week low. Malcolm Fairbairn’s Ascend Capital had more than $12 million in the company at the end of the second quarter. Jim Simons’ Renaissance Technologies and D.E. Shaw’s D E Shaw are also fans of CSH.
FEI Company (FEIC) is a scientific and technical instruments company with a $1.48B market cap and a 14.99 forward P/E ratio. It has a current ratio of 3.09 and a quick ratio of 2.34. So far this year, FEIC has returned 49.26%. It has a 1.26 beta and recently traded at $39.43, 80.04% above its 52-week low. Chuck Royce’s Royce & Associates was bullish on FEIC at the end of the second quarter, boasting a position worth more than $124 million. Ken Fisher’s Fisher Asset Management and Thomas Steyer’s Farallon Capital also like the company.
Hillenbrand Inc (HI) is a personal services company with a $1.29B market cap. It has a 3.71 current ratio and a 3.05 quick ratio. It has returned 1.58% YTD. HI has a 0.75 beta and recently traded at $21.03, 30.40% above its 52-week low. Ric Dillon’s Diamond Hill Capital had more than $26 million in the company at the end of the second quarter. HI is a favorite of Ken Brodkowitz and Mike Vermut’s Newland Capital, as is D.E. Shaw’s D E Shaw.
MICROS Systems Inc (MCRS) is an application software company with a $3.82B market cap and a 19.56 forward P/E ratio. The company has a 3.05 current ratio and a 2.93 quick ratio. So far this year, MCRS has returned 8.39%. It has a beta of 1.22 and recently traded at $47.98, 25.17% above its 52-week low. At the end of the second quarter, Bill Miller’s Legg Mason Capital Management had over $29 million in the company while Steve Cohen’s Sac Capital Advisors had more than $24 million.
W.R. Grace & Co (GRA) is a specialty chemicals company with a $2.94B market cap and a 9.72 forward P/E ratio. It has a current ratio of 3.07 and a quick ratio of 2.54. GRA has returned 13.41% YTD. The company has a 2.42 beta and recently traded at $40.72 a share, up 34.61% over its 52-week low. James Dinan’s York Capital Management had over $223 million in GRA at the end of the second quarter. Jonathan Auerbach’s Hound Partners and Rehan Jaffer’s H Partners Management also had significant positions in the company.
