Trade-Ideas LLC identified

Alon USA Energy

(

ALJ

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

  • ALJ has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $18.7 million.
  • ALJ has traded 361,016 shares today.
  • ALJ is up 3.1% today.
  • ALJ was down 8.5% yesterday.

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More details on ALJ:

Alon USA Energy, Inc. engages in refining and marketing petroleum products, primarily in the South Central, Southwestern, and Western regions of the United States. It operates in three segments: Refining and Marketing, Asphalt, and Retail. The stock currently has a dividend yield of 3.3%. ALJ has a PE ratio of 12. Currently there are no analysts that rate Alon USA Energy a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for Alon USA Energy has been 1.2 million shares per day over the past 30 days. Alon USA Energy has a market cap of $1.3 billion and is part of the basic materials sector and energy industry. The stock has a beta of 0.61 and a short float of 31.5% with 9.01 days to cover. Shares are up 31.8% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Alon USA Energy as a

buy

. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, increase in net income, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:

  • The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • ALON USA ENERGY INC has improved earnings per share by 5.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, ALON USA ENERGY INC increased its bottom line by earning $0.55 versus $0.29 in the prior year. This year, the market expects an improvement in earnings ($1.27 versus $0.55).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 9.0% when compared to the same quarter one year prior, going from $38.48 million to $41.94 million.
  • The debt-to-equity ratio is somewhat low, currently at 0.76, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, ALON USA ENERGY INC's return on equity exceeds that of both the industry average and the S&P 500.

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