3 Stocks Pushing The Energy Industry Lower

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.

The Energy industry as a whole closed the day up 0.1% versus the S&P 500, which was unchanged. Laggards within the Energy industry included Lucas Energy ( LEI), down 8.2%, Houston American Energy ( HUSA), down 4.3%, Blueknight Energy Partners ( BKEP), down 2.4%, TGC Industries ( TGE), down 1.6% and Enservco ( ENSV), down 10.1%.

TheStreet Ratings Group would like to highlight 3 stocks that pushed the industry lower today:

Blueknight Energy Partners ( BKEP) is one of the companies that pushed the Energy industry lower today. Blueknight Energy Partners was down $0.22 (2.4%) to $8.78 on average volume. Throughout the day, 33,945 shares of Blueknight Energy Partners exchanged hands as compared to its average daily volume of 30,500 shares. The stock ranged in price between $8.76-$9.09 after having opened the day at $9.00 as compared to the previous trading day's close of $9.00.

Blueknight Energy Partners, L.P., together with its subsidiaries, provides integrated terminalling, storage, processing, gathering, and transportation services for companies engaged in the production, distribution, and marketing of crude oil and asphalt products in the United States. Blueknight Energy Partners has a market cap of $206.1 million and is part of the basic materials sector. Shares are up 5.6% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Blueknight Energy Partners a buy, 1 analyst rates it a sell, and 1 rates it a hold.

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TheStreet Ratings rates Blueknight Energy Partners as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, unimpressive growth in net income and feeble growth in the company's earnings per share.

Highlights from TheStreet Ratings analysis on BKEP go as follows:

  • BKEP's revenue growth has slightly outpaced the industry average of 3.1%. Since the same quarter one year prior, revenues slightly increased by 4.3%. 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.
  • 37.16% is the gross profit margin for BLUEKNIGHT ENERGY PRTNRS LP which we consider to be strong. Regardless of BKEP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, BKEP's net profit margin of 8.38% compares favorably to the industry average.
  • BLUEKNIGHT ENERGY PRTNRS LP 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. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, BLUEKNIGHT ENERGY PRTNRS LP increased its bottom line by earning $0.43 versus $0.32 in the prior year. For the next year, the market is expecting a contraction of 34.9% in earnings ($0.28 versus $0.43).
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 35.4% when compared to the same quarter one year ago, falling from $6.02 million to $3.89 million.
  • In its most recent trading session, BKEP has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.

You can view the full analysis from the report here: Blueknight Energy Partners Ratings Report

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At the close, Houston American Energy ( HUSA) was down $0.02 (4.3%) to $0.44 on light volume. Throughout the day, 34,541 shares of Houston American Energy exchanged hands as compared to its average daily volume of 592,100 shares. The stock ranged in price between $0.43-$0.47 after having opened the day at $0.47 as compared to the previous trading day's close of $0.46.

Houston American Energy Corp. engages in the exploration, development, and production of natural gas, crude oil, and condensate from properties located principally in the Gulf Coast area of the United States and South America. Houston American Energy has a market cap of $22.4 million and is part of the basic materials sector. Shares are up 71.9% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates Houston American Energy as a sell. The area that we feel has been the company's primary weakness has been its disappointing return on equity.

Highlights from TheStreet Ratings analysis on HUSA go as follows:

  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, HOUSTON AMERN ENERGY CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for HOUSTON AMERN ENERGY CORP is currently very high, coming in at 79.72%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of -401.39% is in-line with the industry average.
  • Net operating cash flow has increased to -$0.14 million or 19.66% when compared to the same quarter last year. In addition, HOUSTON AMERN ENERGY CORP has also modestly surpassed the industry average cash flow growth rate of 16.30%.
  • HUSA has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 41.30, which clearly demonstrates the ability to cover short-term cash needs.
  • This stock has increased by 111.69% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the future course of this stock, we feel that the risks involved in investing in HUSA do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.

You can view the full analysis from the report here: Houston American 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.

Lucas Energy ( LEI) was another company that pushed the Energy industry lower today. Lucas Energy was down $0.05 (8.2%) to $0.55 on light volume. Throughout the day, 70,306 shares of Lucas Energy exchanged hands as compared to its average daily volume of 186,300 shares. The stock ranged in price between $0.55-$0.60 after having opened the day at $0.60 as compared to the previous trading day's close of $0.60.

Lucas Energy, Inc. operates as an independent oil and gas company in Texas. Lucas Energy has a market cap of $17.8 million and is part of the basic materials sector. Shares are down 38.3% year-to-date as of the close of trading on Monday.

TheStreet Ratings rates Lucas Energy as a sell. The company's weaknesses can be seen in multiple areas, such as its weak operating cash flow and generally disappointing historical performance in the stock itself.

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

Highlights from TheStreet Ratings analysis on LEI go as follows:

  • Net operating cash flow has significantly decreased to -$1.01 million or 197.34% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • LEI's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 51.96%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, LUCAS ENERGY INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • LEI, with its decline in revenue, underperformed when compared the industry average of 3.1%. Since the same quarter one year prior, revenues fell by 29.4%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • LEI's debt-to-equity ratio is very low at 0.24 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.46 is very weak and demonstrates a lack of ability to pay short-term obligations.

You can view the full analysis from the report here: Lucas 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.

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