Trade-Ideas LLC identified

Williams Companies

(

WMB

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Williams Companies as such a stock due to the following factors:

  • WMB has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $174.3 million.
  • WMB has traded 57,662 shares today.
  • WMB is down 5.4% today.
  • WMB was up 6.6% yesterday.

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More details on WMB:

The Williams Companies, Inc. operates as an energy infrastructure company primarily in the United States. The company operates in three segments: Williams Partners, Access Midstream, and Williams NGL & Petchem Services. The stock currently has a dividend yield of 15.8%. Currently there are 3 analysts that rate Williams Companies a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Williams Companies has been 17.9 million shares per day over the past 30 days. Williams Companies has a market cap of $12.1 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.50 and a short float of 2.8% with 1.83 days to cover. Shares are down 39.3% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Williams Companies 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 expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and generally higher debt management risk.

Highlights from the ratings report include:

  • Net operating cash flow has significantly increased by 74.78% to $603.00 million when compared to the same quarter last year. In addition, WILLIAMS COS INC has also vastly surpassed the industry average cash flow growth rate of -38.77%.
  • Despite the weak revenue results, WMB has outperformed against the industry average of 31.9%. Since the same quarter one year prior, revenues fell by 13.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 102.4% when compared to the same quarter one year ago, falling from $1,678.00 million to -$40.00 million.
  • The debt-to-equity ratio is very high at 3.21 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.22, which clearly demonstrates the inability to cover short-term cash needs.

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