Today's Dead Cat Bounce Stock: Helix Energy Solutions Group (HLX)

Trade-Ideas LLC identified Helix Energy Solutions Group (HLX) as a "dead cat bounce" (down big yesterday but up big today) candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Helix Energy Solutions Group

(

HLX

) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Helix Energy Solutions Group as such a stock due to the following factors:

  • HLX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $18.2 million.
  • HLX has traded 119,371 shares today.
  • HLX is up 3% today.
  • HLX was down 9% yesterday.

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More details on HLX:

Helix Energy Solutions Group, Inc., together with its subsidiaries, provides specialty services to the offshore energy industry primarily in the Gulf of Mexico, North Sea, the Asia Pacific, and West Africa regions. Currently there are 3 analysts that rate Helix Energy Solutions Group a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Helix Energy Solutions Group has been 1.8 million shares per day over the past 30 days. Helix Energy Solutions Group has a market cap of $852.7 million and is part of the basic materials sector and energy industry. The stock has a beta of 2.76 and a short float of 7.9% with 3.15 days to cover. Shares are up 37.3% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Helix Energy Solutions Group as a

sell

. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, poor profit margins, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the ratings report include:

  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Energy Equipment & Services industry and the overall market, HELIX ENERGY SOLUTIONS GROUP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for HELIX ENERGY SOLUTIONS GROUP is currently lower than what is desirable, coming in at 29.21%. It has decreased from the same quarter the previous year.
  • The share price of HELIX ENERGY SOLUTIONS GROUP has not done very well: it is down 18.52% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • HELIX ENERGY SOLUTIONS GROUP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, HELIX ENERGY SOLUTIONS GROUP swung to a loss, reporting -$3.58 versus $1.85 in the prior year. This year, the market expects an improvement in earnings (-$0.42 versus -$3.58).
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Energy Equipment & Services industry average, but is less than that of the S&P 500. The net income has significantly decreased by 305.0% when compared to the same quarter one year ago, falling from -$2.64 million to -$10.67 million.

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