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

  • RICE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $22.4 million.
  • RICE has traded 118,914 shares today.
  • RICE is trading at 2.44 times the normal volume for the stock at this time of day.
  • RICE is trading at a new low 5.12% 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 RICE:

Rice Energy Inc., an independent natural gas and oil company, engages in the acquisition, exploration, and development of natural gas, oil, and natural gas liquid (NGL) properties in the Appalachian Basin. The company operates through two segments, Exploration and Production, and Midstream. RICE has a PE ratio of 19. Currently there are 14 analysts that rate Rice Energy a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Rice Energy has been 1.7 million shares per day over the past 30 days. Rice Energy has a market cap of $1.8 billion and is part of the basic materials sector and energy industry. Shares are down 34.8% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Rice Energy as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, RICE ENERGY INC's return on equity is below that of both the industry average and the S&P 500.
  • RICE'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 46.17%, 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.
  • RICE ENERGY INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, RICE ENERGY INC turned its bottom line around by earning $1.67 versus -$0.12 in the prior year. For the next year, the market is expecting a contraction of 97.0% in earnings ($0.05 versus $1.67).
  • RICE's debt-to-equity ratio of 0.97 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.98 is weak.
  • The gross profit margin for RICE ENERGY INC is rather high; currently it is at 67.35%. It has increased significantly from the same period last year. Along with this, the net profit margin of 41.04% significantly outperformed against the industry average.

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