Strong On High Relative Volume: MPLX (MPLX) - TheStreet

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

MPLX

(

MPLX

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

  • MPLX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $9.4 million.
  • MPLX has traded 84,087 shares today.
  • MPLX is trading at 42.54 times the normal volume for the stock at this time of day.
  • MPLX is trading at a new high 6.03% 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 MPLX:

MPLX LP owns, operates, develops, and acquires crude oil, refined product, and other hydrocarbon-based product pipelines and other midstream assets in the United States. The stock currently has a dividend yield of 2.4%. MPLX has a PE ratio of 44.9. Currently there are 2 analysts that rate MPLX a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for MPLX has been 98,800 shares per day over the past 30 days. MPLX has a market cap of $2.2 billion and is part of the basic materials sector and energy industry. Shares are up 35.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates MPLX as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, increase in net income, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 2.6%. Since the same quarter one year prior, revenues slightly increased by 9.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.54, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.21, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for MPLX LP is rather high; currently it is at 54.22%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 21.50% significantly outperformed against the industry average.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 54.8% when compared to the same quarter one year prior, rising from $18.60 million to $28.80 million.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, MPLX LP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

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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