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
) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Hornbeck Offshore Services as such a stock due to the following factors:
- HOS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $15.3 million.
- HOS has traded 91,642 shares today.
- HOS is trading at 3.43 times the normal volume for the stock at this time of day.
- HOS is trading at a new low 4.12% below yesterday's close.
'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of 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 (or avoid losses by trimming weak positions). 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.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in HOS with the Ticky from Trade-Ideas. See the FREE profile for HOS NOW at Trade-Ideas
More details on HOS:
Hornbeck Offshore Services, Inc., through its subsidiaries, operates offshore supply vessels (OSVs) and multi-purpose support vessels (MPSVs) primarily in the U.S. Gulf of Mexico and Latin America. HOS has a PE ratio of 8.7. Currently there are 3 analysts that rate Hornbeck Offshore Services a buy, 1 analyst rates it a sell, and 2 rate it a hold.
The average volume for Hornbeck Offshore Services has been 841,900 shares per day over the past 30 days. Hornbeck Offshore Services has a market cap of $793.5 million and is part of the basic materials sector and energy industry. The stock has a beta of 1.90 and a short float of 13.7% with 6.15 days to cover. Shares are down 12.5% year-to-date as of the close of trading on Friday.
rates Hornbeck Offshore Services as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, attractive valuation levels and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow, a generally disappointing performance in the stock itself and deteriorating net income.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 7.4%. Since the same quarter one year prior, revenues rose by 25.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- HORNBECK OFFSHORE SVCS INC has improved earnings per share by 46.9% 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 two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, HORNBECK OFFSHORE SVCS INC increased its bottom line by earning $1.76 versus $0.96 in the prior year. This year, the market expects an improvement in earnings ($2.49 versus $1.76).
- HOS's debt-to-equity ratio of 0.78 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 3.80 is very high and demonstrates very strong liquidity.
- HOS'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 55.33%, 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. 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.
- Net operating cash flow has decreased to $59.09 million or 20.63% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- You can view the full Hornbeck Offshore Services Ratings Report.