Storm The Castle: Chevron (CVX)
Trade-Ideas LLC identified
(
) as a "storm the castle" (crossing above the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified Chevron as such a stock due to the following factors:
- CVX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $888.7 million.
- CVX has traded 3.6 million shares today.
- CVX is trading at 2.07 times the normal volume for the stock at this time of day.
- CVX crossed above its 200-day simple moving average.
'Storm the Castle' stocks are worth watching because trading stocks that begin to experience a breakout can lead to potentially massive profits. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock is then free to find new buyers and momentum traders who can ultimately push the stock significantly higher. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize on. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.
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More details on CVX:
Chevron Corporation, through its subsidiaries, engages in the petroleum, chemicals, and power and energy operations worldwide. The company operates in two segments, Upstream and Downstream. The stock currently has a dividend yield of 4.7%. CVX has a PE ratio of 2. Currently there are 7 analysts that rate Chevron a buy, no analysts rate it a sell, and 7 rate it a hold.
The average volume for Chevron has been 11.9 million shares per day over the past 30 days. Chevron has a market cap of $171.0 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.13 and a short float of 1.7% with 3.44 days to cover. Shares are down 15.3% year-to-date as of the close of trading on Monday.
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Analysis:
rates Chevron as a
. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, disappointing return on equity and weak operating cash flow.
Highlights from the ratings report include:
- CVX's debt-to-equity ratio is very low at 0.23 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- CVX, with its decline in revenue, slightly underperformed the industry average of 37.0%. Since the same quarter one year prior, revenues fell by 37.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Net operating cash flow has decreased to $5,360.00 million or 38.24% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. When compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, CHEVRON CORP's return on equity is below that of both the industry average and the S&P 500.
- You can view the full Chevron Ratings Report.
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