Trade-Ideas LLC identified

Whiting Petroleum

(

WLL

) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Whiting Petroleum as such a stock due to the following factors:

  • WLL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $123.9 million.
  • WLL has traded 3.5 million shares today.
  • WLL is up 3.1% today.
  • WLL was down 8.6% yesterday.

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More details on WLL:

Whiting Petroleum Corporation, an independent oil and gas company, acquires, explores, develops, and produces crude oil, natural gas liquids, and natural gas in the Rocky Mountains and Permian Basin regions of the United States. Currently there are 19 analysts that rate Whiting Petroleum a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Whiting Petroleum has been 10.1 million shares per day over the past 30 days. Whiting has a market cap of $1.9 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.65 and a short float of 12.4% with 1.75 days to cover. Shares are down 74.8% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Whiting Petroleum 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, generally high debt management risk, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:

  • WHITING PETROLEUM CORP 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, WHITING PETROLEUM CORP reported lower earnings of $0.80 versus $3.07 in the prior year. For the next year, the market is expecting a contraction of 172.5% in earnings (-$0.58 versus $0.80).
  • 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 1280.6% when compared to the same quarter one year ago, falling from $157.98 million to -$1,865.11 million.
  • The debt-to-equity ratio of 1.09 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, WLL has a quick ratio of 0.51, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, WHITING PETROLEUM CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 67.82%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 792.42% 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.

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