Rex Energy (REXX) Flagged As Strong On High Volume

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

  • REXX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $2.8 million.
  • REXX has traded 2.3 million shares today.
  • REXX is trading at 7.62 times the normal volume for the stock at this time of day.
  • REXX is trading at a new high 26.90% 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 REXX:

Rex Energy Corporation operates as an independent oil, natural gas liquid, and natural gas company in the Appalachian and Illinois basins in the United States. Currently there are no analysts that rate Rex Energy a buy, 1 analyst rates it a sell, and 9 rate it a hold.

The average volume for Rex Energy has been 3.7 million shares per day over the past 30 days. Rex Energy has a market cap of $38.2 million and is part of the basic materials sector and energy industry. The stock has a beta of 1.63 and a short float of 44.3% with 6.67 days to cover. Shares are down 29.7% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Rex Energy 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 feeble growth in its earnings per share.

Highlights from the ratings report include:
  • The debt-to-equity ratio is very high at 4.93 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 0.21, which clearly demonstrates the inability to cover short-term cash needs.
  • 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, REX ENERGY CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to $17.47 million or 40.06% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, REX ENERGY CORP has marginally lower results.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 84.43%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 37.03% compared to the year-earlier 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.
  • REX ENERGY CORP's earnings per share declined by 37.0% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, REX ENERGY CORP reported poor results of -$7.55 versus -$0.94 in the prior year. This year, the market expects an improvement in earnings (-$1.06 versus -$7.55).

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