Trade-Ideas LLC identified

Alon USA Energy

(

ALJ

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

  • ALJ has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $13.5 million.
  • ALJ has traded 86,198 shares today.
  • ALJ is trading at 2.59 times the normal volume for the stock at this time of day.
  • ALJ is trading at a new high 10.01% 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 ALJ:

Alon USA Energy, Inc. engages in refining and marketing petroleum products, primarily in the South Central, Southwestern, and Western regions of the United States. It operates in three segments: Refining and Marketing, Asphalt, and Retail. The stock currently has a dividend yield of 5.2%. ALJ has a PE ratio of 7. Currently there are no analysts that rate Alon USA Energy a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for Alon USA Energy has been 891,300 shares per day over the past 30 days. Alon USA Energy has a market cap of $827.4 million and is part of the basic materials sector and energy industry. The stock has a beta of 0.77 and a short float of 27.5% with 8.93 days to cover. Shares are down 21.4% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Alon USA Energy as a

buy

. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, increase in net income, notable return on equity, reasonable valuation levels and solid stock price performance. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:

  • ALON USA ENERGY INC has improved earnings per share by 5.5% 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 year. We feel that this trend should continue. During the past fiscal year, ALON USA ENERGY INC increased its bottom line by earning $0.55 versus $0.29 in the prior year. This year, the market expects an improvement in earnings ($1.38 versus $0.55).
  • 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 9.0% when compared to the same quarter one year prior, going from $38.48 million to $41.94 million.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, ALON USA ENERGY INC's return on equity exceeds that of both the industry average and the S&P 500.
  • Compared to where it was trading a year ago, ALJ's share price has not changed very much due to (a) the relatively weak year-over-year performance of the overall market, (b) the company's stagnant earnings, and (c) other mixed results. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.

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