Trade-Ideas: SandRidge Energy (SD) Is Today's Post-Market Leader Stock

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 SandRidge Energy ( SD) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified SandRidge Energy as such a stock due to the following factors:

  • SD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $51.6 million.
  • SD is up 4.3% today from today's close.

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More details on SD:

SandRidge Energy, Inc., together with its subsidiaries, operates as an independent natural gas and oil company in the United States. It operates in three segments: Exploration and Production, Drilling and Oil Field Services, and Midstream Services. Currently there is 1 analyst that rates SandRidge Energy a buy, 3 analysts rate it a sell, and 12 rate it a hold.

The average volume for SandRidge Energy has been 9.5 million shares per day over the past 30 days. SandRidge Energy has a market cap of $3.2 billion and is part of the basic materials sector and energy industry. The stock has a beta of 2.79 and a short float of 16.4% with 8.14 days to cover. Shares are up 2.6% year-to-date as of the close of trading on Wednesday.

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 SandRidge Energy as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and generally high debt management risk.

Highlights from the ratings report include:
  • 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, SANDRIDGE ENERGY INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Currently the debt-to-equity ratio of 1.76 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Even though the debt-to-equity ratio is weak, SD's quick ratio is somewhat strong at 1.49, demonstrating the ability to handle short-term liquidity needs.
  • SD, with its decline in revenue, slightly underperformed the industry average of 3.3%. Since the same quarter one year prior, revenues slightly dropped by 7.3%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.
  • The gross profit margin for SANDRIDGE ENERGY INC is rather high; currently it is at 69.04%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -14.82% is in-line with the industry average.

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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