Trade-Ideas LLC identified

Targa Resources Partners

(

NGLS

) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Targa Resources Partners as such a stock due to the following factors:

  • NGLS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $35.8 million.
  • NGLS has traded 846,348 shares today.
  • NGLS is up 3% today.
  • NGLS was down 5.2% yesterday.

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More details on NGLS:

Targa Resources Partners LP owns, operates, acquires, and develops midstream energy assets in the United States. The stock currently has a dividend yield of 11.2%. NGLS has a PE ratio of 19. Currently there are 8 analysts that rate Targa Resources Partners a buy, no analysts rate it a sell, and 8 rate it a hold.

The average volume for Targa Resources Partners has been 939,800 shares per day over the past 30 days. Targa has a market cap of $5.7 billion and is part of the basic materials sector and energy industry. The stock has a beta of 0.96 and a short float of 4.8% with 4.08 days to cover. Shares are down 41.5% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Targa Resources Partners as a

hold

. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, a generally disappointing performance in the stock itself and deteriorating net income.

Highlights from the ratings report include:

  • Net operating cash flow has increased to $209.80 million or 49.43% when compared to the same quarter last year. In addition, TARGA RESOURCES PARTNERS LP has also vastly surpassed the industry average cash flow growth rate of -20.54%.
  • The debt-to-equity ratio is somewhat low, currently at 0.77, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.85 is somewhat weak and could be cause for future problems.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 58.88%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 98.43% compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • 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. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, TARGA RESOURCES PARTNERS LP's return on equity is significantly below that of the industry average and is below that of the S&P 500.

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