Trade-Ideas LLC identified

Western Refining

(

WNR

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

  • WNR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $63.6 million.
  • WNR has traded 1.3 million shares today.
  • WNR is down 3% today.
  • WNR was up 5.3% yesterday.

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More details on WNR:

Western Refining, Inc. operates as an independent crude oil refiner and marketer of refined products. The company operates through four segments: Refining, NTI, WNRL, and Retail. The stock currently has a dividend yield of 7.6%. WNR has a PE ratio of 6. Currently there are 2 analysts that rate Western Refining a buy, 2 analysts rate it a sell, and 4 rate it a hold.

The average volume for Western Refining has been 3.5 million shares per day over the past 30 days. Western Refining 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 1.19 and a short float of 27.6% with 3.54 days to cover. Shares are down 40.6% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Western Refining as a

hold

. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels and notable return on equity. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, weak operating cash flow and poor profit margins.

Highlights from the ratings report include:

  • WNR, with its decline in revenue, underperformed when compared the industry average of 24.0%. Since the same quarter one year prior, revenues fell by 37.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Net operating cash flow has significantly decreased to $1.10 million or 98.94% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • WESTERN REFINING 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 year. We anticipate that this should continue in the coming year. During the past fiscal year, WESTERN REFINING INC reported lower earnings of $4.26 versus $5.61 in the prior year. For the next year, the market is expecting a contraction of 71.3% in earnings ($1.22 versus $4.26).

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