Trade-Ideas LLC identified

Cheniere Energy

(

LNG

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

  • LNG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $277.1 million.
  • LNG has traded 7.7 million shares today.
  • LNG is up 3.3% today.
  • LNG was down 5.1% yesterday.

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More details on LNG:

Cheniere Energy, Inc., an energy company, engages in the liquefied natural gas (LNG) related business. It operates through two segments, LNG Terminal Business, and LNG and Natural Gas Marketing Business. Currently there are 5 analysts that rate Cheniere Energy a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Cheniere Energy has been 3.9 million shares per day over the past 30 days. Cheniere Energy has a market cap of $11.9 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.90 and a short float of 12.1% with 4.37 days to cover. Shares are down 32% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Cheniere Energy as a

sell

. The company's weaknesses can be seen in multiple areas, such as its weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • Net operating cash flow has significantly decreased to -$280.78 million or 4182.21% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • LNG'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 30.92%, 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.
  • CHENIERE ENERGY INC has improved earnings per share by 42.2% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CHENIERE ENERGY INC reported poor results of -$2.44 versus -$2.32 in the prior year. This year, the market expects an improvement in earnings (-$1.93 versus -$2.44).
  • The gross profit margin for CHENIERE ENERGY INC is currently very high, coming in at 72.09%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of -174.19% is in-line with 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 41.3% when compared to the same quarter one year prior, rising from -$201.93 million to -$118.50 million.

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