Sunoco Logistics Partners (SXL) Weak On High Volume 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 Sunoco Logistics Partners ( SXL) as a weak on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Sunoco Logistics Partners as such a stock due to the following factors:

  • SXL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $35.5 million.
  • SXL has traded 217,897 shares today.
  • SXL is trading at 9.02 times the normal volume for the stock at this time of day.
  • SXL is trading at a new low 3.04% below yesterday's close.

'Weak on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as material stock news, analyst downgrades, insider selling, selling from 'superinvestors,' or that hedge funds and traders are piling out of a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize (or avoid losses by trimming weak positions). In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on SXL:

Sunoco Logistics Partners L.P. transports, terminals, and stores crude oil, refined products, and natural gas liquids (NGL). It operates in four segments: Crude Oil Pipelines, Crude Oil Acquisition and Marketing, Terminal Facilities, and Refined Products Pipelines. The stock currently has a dividend yield of 3.8%. SXL has a PE ratio of 24.3. Currently there are 5 analysts that rate Sunoco Logistics Partners a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Sunoco Logistics Partners has been 775,500 shares per day over the past 30 days. Sunoco Logistics has a market cap of $9.0 billion and is part of the basic materials sector and energy industry. Shares are up 6.6% year-to-date as of the close of trading on Tuesday.

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TheStreet Quant Ratings rates Sunoco Logistics Partners as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, increase in net income, reasonable valuation levels and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 6.3%. Since the same quarter one year prior, revenues slightly increased by 8.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 122.22% and other important driving factors, this stock has surged by 26.04% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, SXL should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 98.7% when compared to the same quarter one year prior, rising from $78.00 million to $155.00 million.
  • SUNOCO LOGISTICS PARTNERS LP reported significant earnings per share improvement 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, SUNOCO LOGISTICS PARTNERS LP reported lower earnings of $1.63 versus $2.12 in the prior year. This year, the market expects an improvement in earnings ($1.80 versus $1.63).


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