3 Stocks Pushing The Energy Industry Lower

The Energy industry as a whole closed the day down 2.6% versus the S&P 500, which was up 0.2%. Laggards within the Energy industry included CKX Lands ( CKX), down 4.0%, Houston American Energy ( HUSA), down 7.7%, Andatee China Marine Fuel Services ( AMCF), down 14.3%, SAExploration Holdings ( SAEX), down 2.6% and Mexco Energy ( MXC), down 9.4%.

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

Imperial Oil ( IMO) is one of the companies that pushed the Energy industry lower today. Imperial Oil was down $0.99 (2.6%) to $36.61 on average volume. Throughout the day, 361,666 shares of Imperial Oil exchanged hands as compared to its average daily volume of 304,200 shares. The stock ranged in price between $36.18-$37.41 after having opened the day at $37.20 as compared to the previous trading day's close of $37.60.

Imperial Oil Limited explores for, produces, and sells crude oil and natural gas in Canada. The company operates through three segments: Upstream, Downstream, and Chemical. The Upstream segment explores for and produces crude oil, natural gas, synthetic oil, and bitumen. Imperial Oil has a market cap of $31.9 billion and is part of the basic materials sector. Shares are down 12.6% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate Imperial Oil a buy, 1 analyst rates it a sell, and 2 rate it a hold.

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TheStreet Ratings rates Imperial Oil as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.

Highlights from TheStreet Ratings analysis on IMO go as follows:

  • The current debt-to-equity ratio, 0.35, is low and is below the industry average, implying that there has been successful management of debt levels.
  • Despite the weak revenue results, IMO has outperformed against the industry average of 34.8%. Since the same quarter one year prior, revenues fell by 19.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Net operating cash flow has significantly decreased to $377.00 million or 62.26% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, IMPERIAL OIL LTD's return on equity is significantly below that of the industry average and is below that of the S&P 500.

You can view the full analysis from the report here: Imperial Oil Ratings Report

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At the close, Andatee China Marine Fuel Services ( AMCF) was down $0.05 (14.3%) to $0.30 on heavy volume. Throughout the day, 115,038 shares of Andatee China Marine Fuel Services exchanged hands as compared to its average daily volume of 31,500 shares. The stock ranged in price between $0.30-$0.37 after having opened the day at $0.34 as compared to the previous trading day's close of $0.35.

Andatee China Marine Fuel Services Corporation, through its subsidiaries, engages in the production, storage, distribution, and trading of blended marine fuel oil for cargo and fishing vessels in the People's Republic of China. Andatee China Marine Fuel Services has a market cap of $4.1 million and is part of the basic materials sector. Shares are down 77.3% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Andatee China Marine Fuel Services as a sell. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, disappointing return on equity, weak operating cash flow, generally disappointing historical performance in the stock itself and poor profit margins.

Highlights from TheStreet Ratings analysis on AMCF go as follows:

  • The debt-to-equity ratio is very high at 2.80 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 0.36, which clearly demonstrates the inability to cover short-term cash needs.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, ANDATEE CHINA MARINE FUEL'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 $0.74 million or 74.14% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • AMCF'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 73.66%, 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 gross profit margin for ANDATEE CHINA MARINE FUEL is currently extremely low, coming in at 5.63%. Regardless of AMCF's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 0.08% trails the industry average.

You can view the full analysis from the report here: Andatee China Marine Fuel Services Ratings Report

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Houston American Energy ( HUSA) was another company that pushed the Energy industry lower today. Houston American Energy was down $0.02 (7.7%) to $0.20 on light volume. Throughout the day, 26,919 shares of Houston American Energy exchanged hands as compared to its average daily volume of 49,300 shares. The stock ranged in price between $0.20-$0.22 after having opened the day at $0.21 as compared to the previous trading day's close of $0.22.

Houston American Energy Corp., an independent energy company, acquires, explores for, develops, and produces 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 $11.0 million and is part of the basic materials sector. Shares are up 37.0% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates Houston American Energy as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, feeble growth in its earnings per share and generally disappointing historical performance in the stock itself.

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Highlights from TheStreet Ratings analysis on HUSA go as follows:

  • 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 121.9% when compared to the same quarter one year ago, falling from -$0.54 million to -$1.19 million.
  • 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 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.
  • HOUSTON AMERN ENERGY CORP 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. Stable Earnings per share over the past year indicate the company has sound management over its earnings and share float. During the past fiscal year, HOUSTON AMERN ENERGY CORP reported poor results of -$0.07 versus -$0.06 in the prior year.
  • The share price of HOUSTON AMERN ENERGY CORP has not done very well: it is down 16.67% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • Despite the weak revenue results, HUSA has significantly outperformed against the industry average of 34.8%. Since the same quarter one year prior, revenues slightly dropped by 3.8%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

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

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