Stock To Watch: Alon USA Energy (ALJ) In Perilous Reversal

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 Alon USA Energy ( ALJ) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Alon USA Energy as such a stock due to the following factors:

  • ALJ has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $16.5 million.
  • ALJ has traded 279,344 shares today.
  • ALJ is down 3.2% today.
  • ALJ was up 5.8% yesterday.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in ALJ with the Ticky from Trade-Ideas. See the FREE profile for ALJ NOW at Trade-Ideas

More details on ALJ:

Alon USA Energy, Inc. operates as an independent refiner and marketer of petroleum products primarily in the South Central, Southwestern, and the Western regions of the United States. The company operates in three segments: Refining and Marketing, Asphalt, and Retail. The stock currently has a dividend yield of 3.3%. ALJ has a PE ratio of 49.9. Currently there is 1 analyst that rates Alon USA Energy a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for Alon USA Energy has been 1.2 million shares per day over the past 30 days. Alon USA Energy has a market cap of $833.9 million and is part of the basic materials sector and energy industry. The stock has a beta of 1.20 and a short float of 50.1% with 7.02 days to cover. Shares are down 28.3% 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 Alon USA Energy as a buy. The company's strengths can be seen in multiple areas, such as its increase in net income, good cash flow from operations, growth in earnings per share and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • 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 234.0% when compared to the same quarter one year prior, rising from -$28.71 million to $38.48 million.
  • Net operating cash flow has significantly increased by 662.09% to $112.94 million when compared to the same quarter last year. In addition, ALON USA ENERGY INC has also vastly surpassed the industry average cash flow growth rate of -1.58%.
  • The debt-to-equity ratio is somewhat low, currently at 0.85, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.87 is somewhat weak and could be cause for future problems.
  • ALON USA ENERGY INC 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, ALON USA ENERGY INC reported lower earnings of $0.29 versus $1.15 in the prior year. This year, the market expects an improvement in earnings ($0.78 versus $0.29).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 6.3%. Since the same quarter one year prior, revenues slightly dropped by 2.3%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

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

null

More from Markets

Billionaire Investor Tim Draper Explains Why Bitcoin Will Hit $250,000 in 2022

Billionaire Investor Tim Draper Explains Why Bitcoin Will Hit $250,000 in 2022

To Think a Trade War's Still Just a Threat Is the Dumbest Thing on Wall Street

To Think a Trade War's Still Just a Threat Is the Dumbest Thing on Wall Street

M&A Trends Still on Investors' Minds Despite Worries Over Tariffs -- ICYMI

M&A Trends Still on Investors' Minds Despite Worries Over Tariffs -- ICYMI

Dow Falls as U.S. Imposes Tariffs on $50 Billion of Chinese Goods

Dow Falls as U.S. Imposes Tariffs on $50 Billion of Chinese Goods

General Motors Spikes on Report It's Considering Listing Shares of Cruise Unit

General Motors Spikes on Report It's Considering Listing Shares of Cruise Unit