Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified

Hornbeck Offshore Services

(

HOS

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

  • HOS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $28.9 million.
  • HOS has traded 129,024 shares today.
  • HOS is trading at 5.30 times the normal volume for the stock at this time of day.
  • HOS is trading at a new high 4.03% 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 HOS:

Hornbeck Offshore Services, Inc., through its subsidiaries, operates offshore supply vessels (OSVs) and multi-purpose support vessels (MPSVs) primarily in the U.S. Gulf of Mexico and Latin America. HOS has a PE ratio of 8.0. Currently there are 3 analysts that rate Hornbeck Offshore Services a buy, 1 analyst rates it a sell, and 2 rate it a hold.

The average volume for Hornbeck Offshore Services has been 936,000 shares per day over the past 30 days. Hornbeck Offshore Services has a market cap of $728.8 million and is part of the basic materials sector and energy industry. The stock has a beta of 1.90 and a short float of 12.3% with 3.25 days to cover. Shares are down 55% year-to-date as of the close of trading on Wednesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Hornbeck Offshore Services as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, attractive valuation levels and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • HOS's revenue growth has slightly outpaced the industry average of 15.9%. Since the same quarter one year prior, revenues rose by 25.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • HORNBECK OFFSHORE SVCS INC has improved earnings per share by 46.9% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, HORNBECK OFFSHORE SVCS INC increased its bottom line by earning $1.76 versus $0.96 in the prior year. This year, the market expects an improvement in earnings ($2.50 versus $1.76).
  • HOS's debt-to-equity ratio of 0.78 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 3.80 is very high and demonstrates very strong liquidity.
  • Net operating cash flow has decreased to $59.09 million or 20.63% 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.
  • 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 55.5% when compared to the same quarter one year ago, falling from $59.16 million to $26.36 million.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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