Trade-Ideas LLC identified

Oceaneering International

(

OII

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

  • OII has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $81.3 million.
  • OII has traded 304,901 shares today.
  • OII is trading at 6.30 times the normal volume for the stock at this time of day.
  • OII is trading at a new low 4.03% below yesterday's close.

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of 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 (or avoid losses by trimming weak positions). 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 OII:

Oceaneering International, Inc. provides engineered services and products primarily to the offshore oil and gas industry worldwide. The stock currently has a dividend yield of 3.8%. OII has a PE ratio of 9. Currently there are 3 analysts that rate Oceaneering International a buy, no analysts rate it a sell, and 11 rate it a hold.

The average volume for Oceaneering International has been 1.5 million shares per day over the past 30 days. Oceaneering International has a market cap of $2.8 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.23 and a short float of 8.8% with 2.15 days to cover. Shares are down 25.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Oceaneering International as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and notable return on equity. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, poor profit margins and feeble growth in the company's earnings per share.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.50, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, OII has a quick ratio of 1.56, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Net operating cash flow has significantly increased by 57.38% to $172.60 million when compared to the same quarter last year. In addition, OCEANEERING INTERNATIONAL has also vastly surpassed the industry average cash flow growth rate of -41.39%.
  • Despite the weak revenue results, OII has outperformed against the industry average of 37.0%. Since the same quarter one year prior, revenues fell by 23.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 44.73%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 39.65% compared to the year-earlier 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.
  • The gross profit margin for OCEANEERING INTERNATIONAL is currently lower than what is desirable, coming in at 30.98%. OII has continued with the weak profit margin when compared to the same quarter of last year.

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