Trade-Ideas LLC identified

Kosmos Energy

(

KOS

) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Kosmos Energy as such a stock due to the following factors:

  • KOS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.1 million.
  • KOS has traded 81,148 shares today.
  • KOS is trading at 2.27 times the normal volume for the stock at this time of day.
  • KOS is trading at a new high 4.14% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into a stock ahead of a catalyst. 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. 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 KOS:

Kosmos Energy Ltd. explores for and produces oil and gas in Africa, Europe, and South America. KOS has a PE ratio of 24. Currently there are 4 analysts that rate Kosmos Energy a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Kosmos Energy has been 1.6 million shares per day over the past 30 days. Kosmos Energy has a market cap of $2.0 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.68 and a short float of 9.1% with 8.46 days to cover. Shares are up 2.3% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Kosmos Energy as a

sell

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

Highlights from the ratings report include:

  • KOS'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 38.54%, 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. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • 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. When compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, KOSMOS ENERGY LTD's return on equity has significantly outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • KOSMOS ENERGY LTD has improved earnings per share by 28.6% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, KOSMOS ENERGY LTD swung to a loss, reporting -$0.20 versus $0.72 in the prior year. For the next year, the market is expecting a contraction of 87.5% in earnings (-$0.38 versus -$0.20).
  • KOS, with its decline in revenue, underperformed when compared the industry average of 24.6%. Since the same quarter one year prior, revenues fell by 43.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • KOS's debt-to-equity ratio of 0.79 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.88 is weak.

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