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Trade-Ideas: Superior Energy Services (SPN) Is Today's "Barbarian At The Gate" Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Superior Energy Services (SPN) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Superior Energy Services as such a stock due to the following factors:

  • SPN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $45.1 million.
  • SPN has traded 458,245 shares today.
  • SPN traded in a range 234.8% of the normal price range with a price range of $0.94.
  • SPN traded above its daily resistance level (quality: 7 days, meaning that the stock is crossing a resistance level set by the last 7 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock s movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in SPN with the Ticky from Trade-Ideas. See the FREE profile for SPN NOW at Trade-Ideas

More details on SPN:

Superior Energy Services, Inc. provides specialized oilfield services and equipment to oil and gas companies. The company operates in four segments: Drilling Products and Services; Onshore Completion and Workover Services; Production Services; and Subsea and Technical Solutions. SPN has a PE ratio of 13.7. Currently there are 11 analysts that rate Superior Energy Services a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Superior Energy Services has been 1.7 million shares per day over the past 30 days. Superior Energy Services has a market cap of $4.1 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.46 and a short float of 1.7% with 1.59 days to cover. Shares are up 23.7% year to date as of the close of trading on Monday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Superior Energy Services as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, solid stock price performance and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.41, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, SPN has a quick ratio of 1.83, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • 38.62% is the gross profit margin for SUPERIOR ENERGY SERVICES INC which we consider to be strong. Regardless of SPN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SPN's net profit margin of 5.91% is significantly lower than the industry average.
  • SPN, with its decline in revenue, underperformed when compared the industry average of 3.5%. Since the same quarter one year prior, revenues slightly dropped by 6.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

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