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

  • NR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.8 million.
  • NR has traded 172,501 shares today.
  • NR is trading at 9.63 times the normal volume for the stock at this time of day.
  • NR is trading at a new low 9.30% 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 NR:

Newpark Resources, Inc. provides various products and services primarily to the oil and gas exploration industry. The company operates in two segments, Fluids Systems, and Mats and Integrated Services. NR has a PE ratio of 27. Currently there are 4 analysts that rate Newpark Resources a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Newpark Resources has been 879,100 shares per day over the past 30 days. Newpark has a market cap of $359.3 million and is part of the basic materials sector and energy industry. The stock has a beta of 1.30 and a short float of 4.3% with 4.81 days to cover. Shares are down 24.1% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Newpark Resources 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 poor profit margins, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • NR's debt-to-equity ratio is very low at 0.30 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 2.68, which clearly demonstrates the ability to cover short-term cash needs.
  • NR, with its decline in revenue, underperformed when compared the industry average of 37.0%. Since the same quarter one year prior, revenues fell by 48.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Net operating cash flow has declined marginally to $25.37 million or 10.00% when compared to the same quarter last year. Despite a decrease in cash flow NEWPARK RESOURCES is still fairing well by exceeding its industry average cash flow growth rate of -41.39%.
  • The gross profit margin for NEWPARK RESOURCES is rather low; currently it is at 18.74%. It has decreased from the same quarter the previous year.

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