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NEW YORK (TheStreet) -- Shares of Basic Energy Services (BAS) - Get Basic Energy Services, Inc. Report were falling 11.6% to $4.18 Friday as oil prices were declining following a note from analyst firm Goldman Sachs on oil prices and demand.

WTI crude oil for October delivery was down 3.31% to $44.40 a barrel Friday morning, and Brent crude oil for October delivery was down 2.97% to $47.44 a barrel.

In a note to investors Goldman Sachs said the oil market "is even more oversupplied than we had expected." The analyst firm said it now expects the surplus to persist in 2016 as OPEC production further increases, resilient non-OPEC supply and slowing demand growth.

Goldman Sachs lowered its 2016 WTI crude oil price forecast to $45 a barrel from $57 a barrel. The analyst firm expects WTI oil prices to fall to $38 a barrel in one month, $42 a barrel in three months, $40 a barrel in six months, and $45 a barrel in 12 months.

Commerzbank also lowered its price forecast on Friday, according to Reuters. The analyst firm said it expects Brent prices to trade at $55 a barrel by the end of 2015 and reach $65 a barrel by the end of 2016.

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On Thursday Basic Energy Services provided an update on its operating data for August 2015, saying that its rig count remained unchanged at 421 rigs in the month.

TheStreet Ratings team rates BASIC ENERGY SERVICES INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

"We rate BASIC ENERGY SERVICES INC (BAS) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, weak operating cash flow and generally high debt management risk."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Energy Equipment & Services industry. The net income has significantly decreased by 2076.9% when compared to the same quarter one year ago, falling from $2.44 million to -$48.30 million.
  • 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, BASIC ENERGY SERVICES INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for BASIC ENERGY SERVICES INC is rather low; currently it is at 20.98%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -24.37% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to $22.34 million or 65.86% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Although BAS's debt-to-equity ratio of 3.42 is very high, it is currently less than that of the industry average. Even though the debt-to-equity ratio is weak, BAS's quick ratio is somewhat strong at 1.46, demonstrating the ability to handle short-term liquidity needs.
  • You can view the full analysis from the report here: BAS Ratings Report