Trade-Ideas LLC identified

Golar LNG

(

GLNG

) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Golar LNG as such a stock due to the following factors:

  • GLNG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $28.5 million.
  • GLNG has traded 2.1 million shares today.
  • GLNG traded in a range 219.9% of the normal price range with a price range of $3.41.
  • GLNG traded above its daily resistance level (quality: 31 days, meaning that the stock is crossing a resistance level set by the last 31 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on GLNG:

Golar LNG Limited, a midstream liquefied natural gas (LNG) company, engages in the transportation, regasification, liquefaction, and trading of LNG. The company operates in three segments: Vessel Operations, LNG Trading, and FLNG. The stock currently has a dividend yield of 11.2%. GLNG has a PE ratio of 1. Currently there are 6 analysts that rate Golar LNG a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Golar LNG has been 2.6 million shares per day over the past 30 days. Golar LNG has a market cap of $1.5 billion and is part of the services sector and transportation industry. The stock has a beta of 0.83 and a short float of 13.8% with 7.46 days to cover. Shares are up 9.4% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Golar LNG as a

sell

. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and weak operating cash flow.

Highlights from the ratings report include:

  • GOLAR LNG LTD 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. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, GOLAR LNG LTD swung to a loss, reporting -$0.50 versus $1.58 in the prior year. For the next year, the market is expecting a contraction of 226.0% in earnings (-$1.63 versus -$0.50).
  • 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 1980.8% when compared to the same quarter one year ago, falling from $7.77 million to -$146.12 million.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, GOLAR LNG LTD underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • The gross profit margin for GOLAR LNG LTD is currently extremely low, coming in at 5.39%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -533.72% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$15.38 million or 181.07% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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