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 Talisman Energy ( TLM) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Talisman Energy as such a stock due to the following factors:
- TLM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $41.0 million.
- TLM has traded 3.2 million shares today.
- TLM traded in a range 238.9% of the normal price range with a price range of $0.54.
- TLM traded above its daily resistance level (quality: 13 days, meaning that the stock is crossing a resistance level set by the last 13 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).
Stocks matching the 'Barbarian at the Gate' 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 positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher. EXCLUSIVE OFFER: Get the inside scoop on opportunities in TLM with the Ticky from Trade-Ideas. See the FREE profile for TLM NOW at Trade-Ideas More details on TLM: Talisman Energy Inc., an oil and gas company, explores for, develops, produces, transports, and markets crude oil, natural gas, and natural gas liquids. The stock currently has a dividend yield of 2.7%. Currently there are 3 analysts that rate Talisman Energy a buy, no analysts rate it a sell, and 8 rate it a hold. The average volume for Talisman Energy has been 3.5 million shares per day over the past 30 days. Talisman Energy has a market cap of $10.5 billion and is part of the basic materials sector and energy industry. Shares are down 12.4% year-to-date as of the close of trading on Tuesday. 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 Talisman Energy 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, disappointing return on equity, weak operating cash flow and generally high debt management risk. Highlights from the ratings report include:
- TALISMAN ENERGY INC 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. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, TALISMAN ENERGY INC reported poor results of -$1.21 versus -$0.02 in the prior year.
- 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 367.3% when compared to the same quarter one year ago, falling from $376.00 million to -$1,005.00 million.
- 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, TALISMAN ENERGY INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has decreased to $442.00 million or 19.04% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- The share price of TALISMAN ENERGY INC has not done very well: it is down 10.97% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
- You can view the full Talisman Energy 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.