CareTrust REIT Inc. (NYSE:CTRE) Combines High Earnings Momentum with Strong Technical Setup

For investors looking to join solid earnings momentum with positive technical patterns, a multi-layered screening method can be very useful. By selecting for stocks with a firm High Growth Momentum (HGM) Rating, which tracks quickening earnings and sales, together with high Technical and Setup Ratings that indicate a sound trend and a possible entry point, one can find securities that match growth-oriented strategies like CANSLIM. This process aims to find companies both seeing fundamental quickening and trading in a way that points to institutional buying and a manageable buying chance.

CareTrust REIT Inc. (NYSE:CTRE) appears from such a screen, offering a strong case for high growth momentum investors who also value technical discipline.

Fundamental Growth Momentum

The center of the HGM Rating is to find companies with forceful and often quickening earnings and sales trends. CareTrust REIT shows several main traits that build its firm HGM Rating of 6.

• Very High Earnings Growth: The company's trailing twelve-month (TTM) EPS has increased by more than 90% against the year before. Even more notable is the recent quarterly speed, with EPS in the last quarter jumping 400% year-over-year, then a 66.7% rise in the latest quarter.
• Firm Revenue Growth: This earnings growth is backed by major top-line growth. TTM revenue is up about 59%, with recent quarterly sales growth regularly over 45%, including a 71.2% rise last quarter.
• Margin Growth and Analyst Trust: The company has shown it can grow its profit margin, a key part of lasting earnings growth. Also, analysts have raised their estimates over the last three months, with next-year revenue estimates climbing almost 4.6%, showing more trust in the company's path.

While free cash flow has been negative, which is not rare for REITs in some stages of their portfolio cycle because of purchases and development, the major strength in earnings, sales, and margin growth forms a persuasive fundamental growth story.

Technical Strength and Trend

A firm growth story must be supported by price action, and CareTrust REIT's technical picture is very sound. According to its detailed technical report, the stock receives a complete Technical Rating of 10 out of 10.

• The long-term and short-term trends are both scored as positive.
• The stock is trading close to its 52-week high and does better than 90% of similar companies in the Diversified REITs industry.
• It is placed above all main moving averages (20, 50, 100, and 200-day), which are all in upward arrangements.
• With a relative strength percentile above 85, CTRE is showing market strength, a main idea of momentum investing.

This technical rating shows the stock is in a forceful, continued uptrend, implying institutional backing and matching the price trend with the positive fundamental story.

Setup Quality and Trade Logic

A high technical rating by itself does not always offer a manageable entry. This is where the Setup Rating of 8 becomes important. The study shows CTRE has been forming its recent gains, with lower volatility and prices trading in a set range over the last month.

The setup finds a clear resistance area just above the present price, near $37.74 to $37.77. A clear move above this level could show the restart of the uptrend. The report notes a recent "Pocket Pivot" signal, a volume-based measure suggesting buying, which adds more support to the setup's quality. For a momentum investor, this pattern gives a set entry point (a move above resistance) and a sensible exit point (a stop-loss below close support), allowing for orderly risk management on a stock with firm underlying momentum.

Finding Like Opportunities

The mix of high growth momentum, technical strength, and a positive setup makes CareTrust REIT a notable candidate for investors using this method. For those aiming to find other stocks that meet such strict standards of firm earnings momentum paired with positive technical breakout patterns, you can review the live screen results through this link: High Growth Momentum Breakout Setups Screen.

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Disclaimer: This article is for information only and does not form investment advice, a suggestion, or an offer to buy or sell any security. The study is based on given data and should not be the only ground for any investment choice. Always do your own study and think about talking with a qualified financial advisor before making any investment. Past results are not a guide for future outcomes.