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

  • WPX has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $92.9 million.
  • WPX has traded 1.7 million shares today.
  • WPX is down 3.1% today.
  • WPX was up 5.9% yesterday.

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More details on WPX:

WPX Energy, Inc., an independent oil and natural gas exploration and production company, engages in the exploitation and development of unconventional properties in the United States. Currently there are 8 analysts that rate WPX Energy a buy, 2 analysts rate it a sell, and 5 rate it a hold.

The average volume for WPX Energy has been 11.7 million shares per day over the past 30 days. WPX Energy has a market cap of $1.7 billion and is part of the basic materials sector and energy industry. The stock has a beta of 2.42 and a short float of 15.7% with 3.64 days to cover. Shares are up 19.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates WPX Energy as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow, generally high debt management risk and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • 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 800.5% when compared to the same quarter one year ago, falling from $219.00 million to -$1,534.00 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, WPX ENERGY INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to $182.00 million or 37.45% when compared to the same quarter last year. Despite a decrease in cash flow of 37.45%, WPX ENERGY INC is in line with the industry average cash flow growth rate of -38.75%.
  • WPX's debt-to-equity ratio of 0.90 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. Despite the fact that WPX's debt-to-equity ratio is mixed in its results, the company's quick ratio of 0.52 is low and demonstrates weak liquidity.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 42.35%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 694.54% compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.

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