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Trade-Ideas LLC identified
) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Pacific Drilling as such a stock due to the following factors:
- PACD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $7.2 million.
- PACD has traded 65,641 shares today.
- PACD is trading at 2.67 times the normal volume for the stock at this time of day.
- PACD is trading at a new low 4.11% 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 PACD:
Pacific Drilling S.A. operates as an offshore drilling contractor. The company provides ultra-deepwater drilling services to the oil and natural gas industry through the use of drilling rigs. PACD has a PE ratio of 6.7. Currently there are 5 analysts that rate Pacific Drilling a buy, no analysts rate it a sell, and 2 rate it a hold.
The average volume for Pacific Drilling has been 932,200 shares per day over the past 30 days. Pacific has a market cap of $980.5 million and is part of the basic materials sector and energy industry. The stock has a beta of 1.64 and a short float of 3.1% with 1.44 days to cover. Shares are down 60.9% year-to-date as of the close of trading on Thursday.
rates Pacific Drilling as a
. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk and generally disappointing historical performance in the stock itself.
Highlights from the ratings report include:
- The debt-to-equity ratio of 1.11 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, PACD has a quick ratio of 0.55, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
- PACD'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 58.83%, 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.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to the other companies in the Energy Equipment & Services industry and the overall market, PACIFIC DRILLING SA's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- PACIFIC DRILLING SA reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, PACIFIC DRILLING SA reported lower earnings of $0.12 versus $0.16 in the prior year. This year, the market expects an improvement in earnings ($0.82 versus $0.12).
- Net operating cash flow has increased to $100.49 million or 15.15% when compared to the same quarter last year. Despite an increase in cash flow, PACIFIC DRILLING SA's average is still marginally south of the industry average growth rate of 17.56%.
- You can view the full Pacific Drilling Ratings Report.