Trade-Ideas LLC identified

Patterson-UTI Energy

(

PTEN

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

  • PTEN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $84.7 million.
  • PTEN has traded 855,239 shares today.
  • PTEN is trading at 6.26 times the normal volume for the stock at this time of day.
  • PTEN is trading at a new high 9.02% 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 PTEN:

TheStreet Recommends

Patterson-UTI Energy, Inc., through its subsidiaries, provides onshore contract drilling services to major and independent oil and natural gas operators in the United States and Canada. The company operates through three segments: Contract Drilling, Pressure Pumping, and Oil and Natural Gas. The stock currently has a dividend yield of 3.5%. Currently there are 10 analysts that rate Patterson-UTI Energy a buy, 1 analyst rates it a sell, and 7 rate it a hold.

The average volume for Patterson-UTI Energy has been 4.9 million shares per day over the past 30 days. Patterson-UTI Energy has a market cap of $1.8 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.05 and a short float of 16.8% with 3.30 days to cover. Shares are down 21.1% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Patterson-UTI Energy as a

sell

. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and weak operating cash flow.

Highlights from the ratings report include:

  • PATTERSON-UTI ENERGY INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from 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, PATTERSON-UTI ENERGY INC reported lower earnings of $1.11 versus $1.28 in the prior year. For the next year, the market is expecting a contraction of 173.4% in earnings (-$0.82 versus $1.11).
  • 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 Energy Equipment & Services industry. The net income has significantly decreased by 1514.5% when compared to the same quarter one year ago, falling from $15.98 million to -$225.98 million.
  • 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. Compared to other companies in the Energy Equipment & Services industry and the overall market, PATTERSON-UTI ENERGY INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for PATTERSON-UTI ENERGY INC is currently lower than what is desirable, coming in at 34.20%. Regardless of PTEN's low profit margin, it has managed to increase from the same period last year.
  • Net operating cash flow has decreased to $165.38 million or 19.77% when compared to the same quarter last year. Despite a decrease in cash flow PATTERSON-UTI ENERGY INC is still fairing well by exceeding its industry average cash flow growth rate of -38.19%.

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