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 Pacific Ethanol ( PEIX) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Pacific Ethanol as such a stock due to the following factors:
- PEIX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $17.0 million.
- PEIX has traded 167,232 shares today.
- PEIX is down 3.5% today.
- PEIX was up 5.8% yesterday.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in PEIX with the Ticky from Trade-Ideas. See the FREE profile for PEIX NOW at Trade-Ideas More details on PEIX: Pacific Ethanol, Inc. produces and markets low-carbon renewable fuels in the United States. It sells ethanol to gasoline refining and distribution companies. The average volume for Pacific Ethanol has been 2.1 million shares per day over the past 30 days. Pacific Ethanol has a market cap of $234.7 million and is part of the basic materials sector and chemicals industry. The stock has a beta of 3.98 and a short float of 13.7% with 1.87 days to cover. Shares are up 142% year-to-date as of the close of trading on Monday. 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 Pacific Ethanol as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income and poor profit margins. Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 3.3%. Since the same quarter one year prior, revenues rose by 12.9%. 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.
- Compared to its closing price of one year ago, PEIX's share price has jumped by 161.08%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- PACIFIC ETHANOL INC's earnings per share declined by 15.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, PACIFIC ETHANOL INC continued to lose money by earning -$0.39 versus -$2.70 in the prior year. This year, the market expects an improvement in earnings ($4.15 versus -$0.39).
- The gross profit margin for PACIFIC ETHANOL INC is rather low; currently it is at 15.14%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, PEIX's net profit margin of -4.25% significantly underperformed when compared to the industry average.
- 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 98.5% when compared to the same quarter one year ago, falling from -$5.45 million to -$10.83 million.
- You can view the full Pacific Ethanol 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.