Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
Trade-Ideas LLC identified
) as a "storm the castle" (crossing above the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified Oil States International as such a stock due to the following factors:
- OIS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $54.9 million.
- OIS has traded 147,781 shares today.
- OIS is trading at 3.48 times the normal volume for the stock at this time of day.
- OIS crossed above its 200-day simple moving average.
'Storm the Castle' stocks are worth watching because trading stocks that begin to experience a breakout can lead to potentially massive profits. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock is then free to find new buyers and momentum traders who can ultimately push the stock significantly higher. 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 on. 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 OIS:
Oil States International, Inc., through its subsidiaries, provides specialty products and services to natural resources companies worldwide. It operates through three segments: Accommodations, Offshore Products, and Well Site Services. OIS has a PE ratio of 18.1. Currently there are 3 analysts that rate Oil States International a buy, no analysts rate it a sell, and 7 rate it a hold.
The average volume for Oil States International has been 591,300 shares per day over the past 30 days. Oil States International has a market cap of $5.0 billion and is part of the basic materials sector and energy industry. The stock has a beta of 2.30 and a short float of 4.2% with 3.06 days to cover. Shares are down 4.1% year-to-date as of the close of trading on Friday.
rates Oil States International as a
. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.
Highlights from the ratings report include:
- Despite currently having a low debt-to-equity ratio of 0.38, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 3.16 is very high and demonstrates very strong liquidity.
- 36.80% is the gross profit margin for OIL STATES INTL INC which we consider to be strong. Regardless of OIS's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 10.81% trails the industry average.
- OIS, with its decline in revenue, underperformed when compared the industry average of 10.9%. Since the same quarter one year prior, revenues slightly dropped by 2.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, OIS has underperformed the S&P 500 Index, declining 6.18% from its price level of one year ago. Looking ahead, although the push and pull of the overall market trend could certainly make a critical difference, we do not see any strong reason stemming from the company's fundamentals that would cause a continuation of last year's decline. In fact, the stock is now selling for less than others in its industry in relation to its current earnings.
- OIL STATES INTL INC's earnings per share declined by 21.9% in the most recent quarter compared to the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, OIL STATES INTL INC reported lower earnings of $5.61 versus $7.25 in the prior year. For the next year, the market is expecting a contraction of 2.3% in earnings ($5.48 versus $5.61).
- You can view the full Oil States International Ratings Report.