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 Concho Resources ( CXO) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Concho Resources as such a stock due to the following factors:
- CXO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $162.4 million.
- CXO is making at least a new 3-day high.
- CXO has a PE ratio of 54.6.
- CXO is mentioned 0.87 times per day on StockTwits.
- CXO has not yet been mentioned on StockTwits today.
- CXO is currently in the upper 20% of its 1-year range.
- CXO is in the upper 35% of its 20-day range.
- CXO is in the upper 45% of its 5-day range.
- CXO is currently trading above yesterday's high.
'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention. EXCLUSIVE OFFER: Get the inside scoop on opportunities in CXO with the Ticky from Trade-Ideas. See the FREE profile for CXO NOW at Trade-Ideas More details on CXO: Concho Resources Inc. acquires, develops, and explores oil and natural gas reserves. The company was founded in 2001 and is based in Midland, Texas. CXO has a PE ratio of 54.6. Currently there are 17 analysts that rate Concho Resources a buy, no analysts rate it a sell, and 4 rate it a hold. The average volume for Concho Resources has been 1.1 million shares per day over the past 30 days. Concho has a market cap of $11.8 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.97 and a short float of 3.1% with 1.93 days to cover. Shares are up 3.7% year-to-date as of the close of trading on Friday. 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 Concho Resources as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in net income and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, disappointing return on equity and feeble growth in the company's earnings per share. Highlights from the ratings report include:
- The revenue growth greatly exceeded the industry average of 2.4%. Since the same quarter one year prior, revenues rose by 40.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 408.0% when compared to the same quarter one year prior, rising from $5.99 million to $30.42 million.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry, implying reduced upside potential.
- The debt-to-equity ratio of 1.00 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, CXO has a quick ratio of 0.63, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, CONCHO RESOURCES INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- You can view the full Concho Resources Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.