Trade-Ideas LLC identified

Midstates Petroleum

(

MPO

) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Midstates Petroleum as such a stock due to the following factors:

  • MPO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $7.8 million.
  • MPO has traded 321,478 shares today.
  • MPO is trading at 16.61 times the normal volume for the stock at this time of day.
  • MPO is trading at a new low 16.08% 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.

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More details on MPO:

Midstates Petroleum Company, Inc. engages in the exploration, development, and production of oil, natural gas liquids, and natural gas in the United States. Currently there is 1 analyst that rates Midstates Petroleum a buy, no analysts rate it a sell, and 7 rate it a hold.

The average volume for Midstates Petroleum has been 267,300 shares per day over the past 30 days. Midstates has a market cap of $35.0 million and is part of the basic materials sector and energy industry. The stock has a beta of 2.95 and a short float of 22.8% with 0.62 days to cover. Shares are down 52.6% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Midstates Petroleum as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the ratings report include:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 28424.2% when compared to the same quarter one year ago, falling from -$2.10 million to -$598.44 million.
  • Net operating cash flow has significantly decreased to $25.63 million or 67.80% 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.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 92.76%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 8740.00% compared to the year-earlier 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.
  • MIDSTATES PETROLEUM CO INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, MIDSTATES PETROLEUM CO INC turned its bottom line around by earning $4.90 versus -$54.60 in the prior year. For the next year, the market is expecting a contraction of 233.1% in earnings (-$6.52 versus $4.90).
  • MPO, with its decline in revenue, underperformed when compared the industry average of 34.5%. Since the same quarter one year prior, revenues fell by 49.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

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