Trade-Ideas LLC identified

HollyFrontier

(

HFC

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified HollyFrontier as such a stock due to the following factors:

  • HFC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $104.7 million.
  • HFC has traded 126,236 shares today.
  • HFC is down 3.9% today.
  • HFC was up 11.3% yesterday.

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

More details on HFC:

HollyFrontier Corporation operates as an independent petroleum refiner in the United States. The company operates in two segments, Refining and HEP. The stock currently has a dividend yield of 4.3%. HFC has a PE ratio of 1. Currently there are 5 analysts that rate HollyFrontier a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for HollyFrontier has been 3.1 million shares per day over the past 30 days. HollyFrontier has a market cap of $5.6 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.12 and a short float of 4.9% with 2.83 days to cover. Shares are down 15.2% year-to-date as of the close of trading on Wednesday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates HollyFrontier as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and poor profit margins.

Highlights from the ratings report include:

  • 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 12.2% when compared to the same quarter one year prior, going from $175.01 million to $196.32 million.
  • HFC's debt-to-equity ratio is very low at 0.17 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.05, which illustrates the ability to avoid short-term cash problems.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, HOLLYFRONTIER CORP has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • The gross profit margin for HOLLYFRONTIER CORP is currently extremely low, coming in at 12.30%. Regardless of HFC's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, HFC's net profit margin of 5.47% compares favorably to the industry average.
  • HFC's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 28.27%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.