Noble Corporation (NE) Is Water-Logged And Getting Wetter Today

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 Noble Corporation ( NE) 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 Corporation as such a stock due to the following factors:

  • NE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $127.4 million.
  • NE has traded 350,400 shares today.
  • NE traded in a range 245.7% of the normal price range with a price range of $1.79.
  • NE traded below its daily resistance level (quality: 432 days, meaning that the stock is crossing a resistance level set by the last 432 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 NE:

Noble Corporation operates as an offshore drilling contractor for the oil and gas industry. The company offers contract drilling services for oil and gas wells. Currently there are 12 analysts that rate Noble Corporation a buy, 2 analysts rate it a sell, and 5 rate it a hold.

The average volume for Noble Corporation has been 3.2 million shares per day over the past 30 days. Noble has a market cap of $9.0 billion and is part of the basic materials sector and energy industry.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Noble Corporation as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, expanding profit margins and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 9.1%. Since the same quarter one year prior, revenues rose by 22.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • NOBLE CORP reported significant earnings per share improvement 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 CORP increased its bottom line by earning $2.05 versus $1.45 in the prior year. This year, the market expects an improvement in earnings ($2.91 versus $2.05).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Energy Equipment & Services industry. The net income increased by 145.7% when compared to the same quarter one year prior, rising from $114.77 million to $281.96 million.
  • The gross profit margin for NOBLE CORP is rather high; currently it is at 51.46%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 26.13% significantly outperformed against the industry average.
  • Net operating cash flow has increased to $515.59 million or 30.34% when compared to the same quarter last year. Despite an increase in cash flow, NOBLE CORP's average is still marginally south of the industry average growth rate of 30.43%.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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