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The Energy industry as a whole closed the day up 0.4% versus the S&P 500, which was down 0.9%. Laggards within the Energy industry included WSP Holdings ( WH), down 4.3%, Forbes Energy Services ( FES), down 3.9%, Houston American Energy ( HUSA), down 1.8%, Mexco Energy ( MXC), down 4.5% and Isramco ( ISRL), down 5.3%.

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

Houston American Energy ( HUSA) is one of the companies that pushed the Energy industry lower today. Houston American Energy was down $0.01 (1.8%) to $0.43 on light volume. Throughout the day, 137,489 shares of Houston American Energy exchanged hands as compared to its average daily volume of 327,600 shares. The stock ranged in price between $0.41-$0.45 after having opened the day at $0.41 as compared to the previous trading day's close of $0.44.

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 $21.7 million and is part of the basic materials sector. Shares are up 75.9% year-to-date as of the close of trading on Wednesday.

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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.
  • 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 HOUSTON AMERN ENERGY CORP is currently very high, coming in at 74.53%. 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 -504.71% is in-line with the industry average.
  • Net operating cash flow has increased to -$0.70 million or 19.70% 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 17.43%.
  • 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 35.70, which clearly demonstrates the ability to cover short-term cash needs.

You can view the full analysis from the report here: Houston American Energy Ratings Report

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At the close, Forbes Energy Services ( FES) was down $0.17 (3.9%) to $4.23 on light volume. Throughout the day, 4,696 shares of Forbes Energy Services exchanged hands as compared to its average daily volume of 26,100 shares. The stock ranged in price between $4.16-$4.44 after having opened the day at $4.33 as compared to the previous trading day's close of $4.40.

Forbes Energy Services Ltd., an independent oilfield services contractor, provides a range of well site services for oil and natural gas drilling and producing companies to develop and enhance the production of oil and natural gas in the United States. Forbes Energy Services has a market cap of $94.6 million and is part of the basic materials sector. Shares are up 34.6% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate Forbes Energy Services a buy, no analysts rate it a sell, and 1 rates it a hold.

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TheStreet Ratings rates Forbes Energy Services as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow, poor profit margins and generally high debt management risk.

Highlights from TheStreet Ratings analysis on FES go as follows:

  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Energy Equipment & Services industry and the overall market, FORBES ENERGY SERVICES LTD's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to $5.57 million or 76.31% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The gross profit margin for FORBES ENERGY SERVICES LTD is rather low; currently it is at 24.70%. Regardless of FES's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, FES's net profit margin of -1.17% significantly underperformed when compared to the industry average.
  • The debt-to-equity ratio is very high at 2.21 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Regardless of the company's weak debt-to-equity ratio, FES has managed to keep a strong quick ratio of 2.32, which demonstrates the ability to cover short-term cash needs.
  • FORBES ENERGY SERVICES LTD has improved earnings per share by 46.1% 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, FORBES ENERGY SERVICES LTD swung to a loss, reporting -$0.63 versus $0.01 in the prior year. This year, the market expects an improvement in earnings (-$0.25 versus -$0.63).

You can view the full analysis from the report here: Forbes Energy Services Ratings Report

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WSP Holdings ( WH) was another company that pushed the Energy industry lower today. WSP Holdings was down $0.04 (4.3%) to $0.90 on heavy volume. Throughout the day, 83,541 shares of WSP Holdings exchanged hands as compared to its average daily volume of 54,600 shares. The stock ranged in price between $0.85-$1.02 after having opened the day at $1.02 as compared to the previous trading day's close of $0.94.

WSP Holdings Limited, together with its subsidiaries, manufactures and sells seamless oil country tubular goods. WSP Holdings has a market cap of $20.8 million and is part of the basic materials sector. Shares are down 65.6% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates WSP Holdings 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, generally high debt management risk, disappointing return on equity and poor profit margins.

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Highlights from TheStreet Ratings analysis on WH go as follows:

  • WSP HOLDINGS LTD 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 suffered a declining pattern earnings per share over the past two years. During the past fiscal year, WSP HOLDINGS LTD reported poor results of -$4.12 versus -$3.30 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 Energy Equipment & Services industry. The net income has significantly decreased by 55.5% when compared to the same quarter one year ago, falling from -$16.61 million to -$25.83 million.
  • The debt-to-equity ratio is very high at 6.75 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.33, which clearly demonstrates the inability to cover short-term cash needs.
  • 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 Energy Equipment & Services industry and the overall market, WSP HOLDINGS LTD's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for WSP HOLDINGS LTD is rather low; currently it is at 20.56%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, WH's net profit margin of -21.64% significantly underperformed when compared to the industry average.

You can view the full analysis from the report here: WSP Holdings Ratings Report

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