Trade-Ideas LLC identified

RPC

(

RES

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified RPC as such a stock due to the following factors:

  • RES has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $23.1 million.
  • RES has traded 289,481 shares today.
  • RES is down 3% today.
  • RES was up 8.7% yesterday.

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More details on RES:

RPC, Inc. provides a range of oilfield services and equipment for oil and gas companies involved in the exploration, production, and development of oil and gas properties in the United States, Africa, Canada, China, Eastern Europe, Latin America, the Middle East, and New Zealand. The stock currently has a dividend yield of 1.6%. RES has a PE ratio of 2. Currently there are 2 analysts that rate RPC a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for RPC has been 2.1 million shares per day over the past 30 days. RPC has a market cap of $2.3 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.25 and a short float of 19% with 5.32 days to cover. Shares are down 11.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates RPC 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 and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, poor profit margins and disappointing return on equity.

Highlights from the ratings report include:

  • RES's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 2.97, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has significantly increased by 954.51% to $143.63 million when compared to the same quarter last year. In addition, RPC INC has also vastly surpassed the industry average cash flow growth rate of -20.96%.
  • RES, with its decline in revenue, underperformed when compared the industry average of 31.2%. Since the same quarter one year prior, revenues fell by 48.9%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The gross profit margin for RPC INC is rather low; currently it is at 18.80%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -11.44% is significantly below that of the industry average.
  • 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 153.8% when compared to the same quarter one year ago, falling from $63.28 million to -$34.06 million.

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