Triangle Petroleum (TPLM) Is Strong 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.

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

  • TPLM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $5.8 million.
  • TPLM has traded 395,296 shares today.
  • TPLM is trading at 9.66 times the normal volume for the stock at this time of day.
  • TPLM is trading at a new high 3.03% 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 TPLM:

Triangle Petroleum Corporation, an independent energy company, explores for, develops, and produces oil and natural gas resources primarily in the Bakken Shale and Three Forks formations in the Williston Basin of North Dakota and Montana. TPLM has a PE ratio of 5. Currently there are 2 analysts that rate Triangle Petroleum a buy, 1 analyst rates it a sell, and 7 rate it a hold.

The average volume for Triangle Petroleum has been 1.3 million shares per day over the past 30 days. Triangle has a market cap of $387.5 million and is part of the basic materials sector and energy industry. The stock has a beta of 0.79 and a short float of 19% with 11.08 days to cover. Shares are up 7.5% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Triangle Petroleum as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, compelling growth in net income and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • TPLM's very impressive revenue growth greatly exceeded the industry average of 38.5%. Since the same quarter one year prior, revenues leaped by 83.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 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 173.1% when compared to the same quarter one year prior, rising from $14.25 million to $38.91 million.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, TRIANGLE PETROLEUM CORP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • TPLM's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 48.16%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The debt-to-equity ratio of 1.47 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, TPLM maintains a poor quick ratio of 0.85, which illustrates the inability to avoid short-term cash problems.

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