Trade-Ideas LLC identified Diamondback Energy ( FANG) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Diamondback Energy as such a stock due to the following factors:

  • FANG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $106.7 million.
  • FANG has traded 197,690 shares today.
  • FANG is up 3.3% today.
  • FANG was down 6% yesterday.

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More details on FANG:

Diamondback Energy, Inc., an independent oil and natural gas company, focuses on the acquisition, development, exploration, and exploitation of onshore oil and natural gas reserves in the Permian Basin in West Texas. Currently there are 16 analysts that rate Diamondback Energy a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Diamondback Energy has been 1.1 million shares per day over the past 30 days. Diamondback Energy has a market cap of $4.4 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.28 and a short float of 11.1% with 3.06 days to cover. Shares are up 4% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Diamondback Energy as a hold. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and feeble growth in the company's earnings per share.

Highlights from the ratings report include:
  • Net operating cash flow has significantly increased by 51.50% to $139.82 million when compared to the same quarter last year. In addition, DIAMONDBACK ENERGY INC has also vastly surpassed the industry average cash flow growth rate of -26.70%.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • 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 458.4% when compared to the same quarter one year ago, falling from $43.74 million to -$156.78 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, DIAMONDBACK ENERGY INC's return on equity significantly trails that of both the industry average and the S&P 500.

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