Strong On High Volume: EQT (EQT)

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.

Trade-Ideas LLC identified EQT ( EQT) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified EQT as such a stock due to the following factors:

  • EQT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $86.5 million.
  • EQT has traded 89,106 shares today.
  • EQT is trading at 3.17 times the normal volume for the stock at this time of day.
  • EQT is trading at a new high 3.02% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into 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. 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 EQT:

EQT Corporation, together with its subsidiaries, operates as a natural gas company in the United States. It operates in two segments, EQT Production and EQT Midstream. The stock currently has a dividend yield of 0.1%. EQT has a PE ratio of 35. Currently there are 11 analysts that rate EQT a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for EQT has been 1.2 million shares per day over the past 30 days. EQT has a market cap of $12.8 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.13 and a short float of 3.2% with 4.08 days to cover. Shares are up 11% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates EQT as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 38.5%. Since the same quarter one year prior, revenues slightly increased by 7.1%. 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.
  • The debt-to-equity ratio is somewhat low, currently at 0.68, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. To add to this, EQT has a quick ratio of 1.91, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The gross profit margin for EQT CORP is currently very high, coming in at 71.89%. Regardless of EQT's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, EQT's net profit margin of 24.46% significantly outperformed against the industry.
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Oil, Gas & Consumable Fuels industry average. The net income has decreased by 9.8% when compared to the same quarter one year ago, dropping from $192.19 million to $173.43 million.
  • EQT CORP's earnings per share declined by 9.5% in the most recent quarter compared to 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, EQT CORP increased its bottom line by earning $2.53 versus $1.97 in the prior year. For the next year, the market is expecting a contraction of 34.0% in earnings ($1.67 versus $2.53).

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