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 "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Noble Energy as such a stock due to the following factors:
- NBL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $118.5 million.
- NBL has traded 2.2 million shares today.
- NBL traded in a range 254% of the normal price range with a price range of $4.28.
- NBL traded below its daily resistance level (quality: 42 days, meaning that the stock is crossing a resistance level set by the last 42 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).
Stocks matching the 'Water-Logged and Getting Wetter' 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 negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.
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More details on NBL:
Noble Energy, Inc., an independent energy company, engages in the acquisition, exploration, development, production, and marketing of crude oil, natural gas, and natural gas liquids primarily in the United States, West Africa, and Eastern Mediterranean. The stock currently has a dividend yield of 0.8%. NBL has a PE ratio of 24.7. Currently there are 12 analysts that rate Noble Energy a buy, no analysts rate it a sell, and 9 rate it a hold.
The average volume for Noble Energy has been 1.7 million shares per day over the past 30 days. Noble Energy has a market cap of $26.2 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.56 and a short float of 2.5% with 4.17 days to cover. Shares are up 43.9% year to date as of the close of trading on Tuesday.
rates Noble Energy as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, solid stock price performance, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
Highlights from the ratings report include:
- The revenue growth greatly exceeded the industry average of 5.4%. Since the same quarter one year prior, revenues rose by 40.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- NOBLE ENERGY INC has improved earnings per share by 16.5% 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 year. We feel that this trend should continue. During the past fiscal year, NOBLE ENERGY INC increased its bottom line by earning $2.67 versus $1.10 in the prior year. This year, the market expects an improvement in earnings ($3.19 versus $2.67).
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 51.09% over the past year, a rise that has exceeded that of the S&P 500 Index. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- The gross profit margin for NOBLE ENERGY INC is currently very high, coming in at 78.30%. Regardless of NBL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, NBL's net profit margin of 15.21% compares favorably to the industry average.
- Despite currently having a low debt-to-equity ratio of 0.51, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.84 is weak.
- You can view the full Noble Energy Ratings Report.