National Healthcare Stock Jumps 12% In 2 Days In Massive Volume

National Healthcare (NHC) has put up dazzling numbers the last couple of quarters. The question now is: Can it continue to report 72% to 93% quarterly earnings growth? On Tuesday, the IBD SmartSelect Composite Rating for National stock jumped to 96, up from 93 the day before.

National Healthcare stock gapped up 11.2% on Monday in massive volume, 978% above average. It rose again Tuesday, up 0.7% to 86.86 in trading volume that was 434% above average.

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The upgraded Composite Rating means National Healthcare stock currently tops 96% of all other stocks in terms of key performance metrics and technical strength. The best stocks tend to have a 95 or better grade as they kick off a significant move. National stock just joined that elite group of stocks that are potentially the best stocks to buy and watch.

National Healthcare Stock Pops Amid Soaring Profits

On Nov. 2, the Murfreesboro, Tenn.-based company, just outside of Nashville, posted a 72% EPS gain for Q3 to 86 cents per share. The prior quarter its EPS popped 93%. But it should be noted that the huge gains came after back-to-back quarters of shrinking EPS, by 29% and 13%. Revenue grew 7% in its most recent quarter, to $288.5 million. That marks three quarters of rising sales growth.

Also note that it is a thinly traded stock, with average daily dollar volume under $8 million. Thinly traded stocks tend to be more volatile than ones with larger daily volume because they are more susceptible to large price swings on big trades by funds.

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National Healthcare operates 23 assisted living facilities for seniors, five independent living centers and 35 home-care programs. The modern concept of assisted living facilities is a fairly new one, traced back to Dr. Keren Wilson who opened what is thought to be the first assisted living facility in 1981. The facilities offer apartments, dining rooms and various activities for seniors in a community setting.

Other Ratings Confirm Leader Status

National stock sports an 88 Earnings Per Share Rating, meaning its recent quarterly and longer-term annual earnings growth is outpacing 88% of all stocks.

Its Accumulation/Distribution Rating of A shows heavy buying by institutional investors, such as mutual funds and pension funds, over the last 13 weeks.

National stock holds the No. 3 rank among its peers in the small, eight-stock Medical-Long-Term Care industry group. Idaho-based senior living facilities operator Pennant Group (PNTG) is the No. 1-ranked stock in the group.

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