Summit Midstream Partners (SMLP) Showing Signs Of Perilous Reversal 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 Summit Midstream Partners ( SMLP) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Summit Midstream Partners as such a stock due to the following factors:

  • SMLP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $27.2 million.
  • SMLP has traded 51,092 shares today.
  • SMLP is down 3.8% today.
  • SMLP was up 8% yesterday.

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More details on SMLP:

Summit Midstream Partners, LP focuses on the ownership and operation of midstream energy infrastructure assets, primarily shale formations in North America. It offers natural gas gathering and compression services. Currently there are 3 analysts that rate Summit Midstream Partners a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Summit Midstream Partners has been 34,600 shares per day over the past 30 days. Summit Midstream has a market cap of $1.2 billion and is part of the utilities sector and utilities industry.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Summit Midstream Partners as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, robust revenue growth and good cash flow from operations. However, as a counter to these strengths, we find that the growth in the company's earnings per share has not been good.

Highlights from the ratings report include:
  • Compared to its closing price of one year ago, SMLP's share price has jumped by 70.37%, exceeding the performance of the broader market during that same time frame.
  • SMLP's very impressive revenue growth greatly exceeded the industry average of 7.7%. Since the same quarter one year prior, revenues leaped by 54.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, SUMMIT MIDSTREAM PARTNERS LP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • SUMMIT MIDSTREAM PARTNERS LP's earnings per share declined by 20.0% in the most recent quarter compared to the same quarter a year ago. This year, the market expects an improvement in earnings ($0.99 versus $0.50).
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Oil, Gas & Consumable Fuels industry average, but is less than that of the S&P 500. The net income has decreased by 9.5% when compared to the same quarter one year ago, dropping from $7.40 million to $6.69 million.

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