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Trade-Ideas LLC identified
) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified BioFuel Energy Corporation as such a stock due to the following factors:
- BIOF has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $16.4 million.
- BIOF has traded 365,901 shares today.
- BIOF is down 12.3% today.
- BIOF was up 132.5% yesterday.
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More details on BIOF:
BioFuel Energy Corp. produces and sells ethanol and its related co-products in the United States. The company offers co-products of ethanol, including dried and wet distillers grains with solubles, condensed distillers solubles, and corn oil.
The average volume for BioFuel Energy Corporation has been 469,900 shares per day over the past 30 days. BioFuel Energy has a market cap of $16.1 million and is part of the basic materials sector and chemicals industry. The stock has a beta of 5.90 and a short float of 6.6% with 0.17 days to cover. Shares are up 73.1% year-to-date as of the close of trading on Friday.
rates BioFuel Energy Corporation as a
. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.
Highlights from the ratings report include:
- The debt-to-equity ratio is very high at 3.98 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.13, which clearly demonstrates the inability to cover short-term cash needs.
- 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 Oil, Gas & Consumable Fuels industry and the overall market, BIOFUEL ENERGY CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for BIOFUEL ENERGY CORP is currently extremely low, coming in at 4.42%. Regardless of BIOF's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, BIOF's net profit margin of -5.64% significantly underperformed when compared to the industry average.
- BIOF'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 44.26%, 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. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- BIOFUEL ENERGY CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, BIOFUEL ENERGY CORP reported poor results of -$7.62 versus -$2.60 in the prior year.
- You can view the full BioFuel Energy Corporation Ratings Report.