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Trade-Ideas LLC identified
) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Linn Energy as such a stock due to the following factors:
- LINE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $29.3 million.
- LINE has traded 1.7 million shares today.
- LINE is down 21.8% today.
- LINE was up 12.3% yesterday.
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More details on LINE:
Linn Energy, LLC, an independent oil and natural gas company, acquires and develops oil and natural gas properties in the Unites States. The stock currently has a dividend yield of 22.7%. Currently there are 2 analysts that rate Linn Energy a buy, no analysts rate it a sell, and 8 rate it a hold.
The average volume for Linn Energy has been 3.3 million shares per day over the past 30 days. Linn Energy has a market cap of $1.9 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.15 and a short float of 6% with 2.10 days to cover. Shares are down 43.2% year-to-date as of the close of trading on Tuesday.
rates Linn Energy as a
. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, poor profit margins and weak operating cash flow.
Highlights from the ratings report include:
- 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 297.4% when compared to the same quarter one year ago, falling from -$85.34 million to -$339.16 million.
- The debt-to-equity ratio is very high at 2.52 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.49, which clearly demonstrates the inability to cover short-term cash needs.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, LINN ENERGY LLC's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for LINN ENERGY LLC is currently extremely low, coming in at 8.13%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -37.00% is significantly below that of the industry average.
- Net operating cash flow has decreased to $374.70 million or 13.75% when compared to the same quarter last year. Despite a decrease in cash flow LINN ENERGY LLC is still fairing well by exceeding its industry average cash flow growth rate of -53.49%.
- You can view the full Linn Energy Ratings Report.