Strong On High Relative Volume: Gran Tierra Energy (GTE)

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

  • GTE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.0 million.
  • GTE has traded 279,300 shares today.
  • GTE is trading at 3.76 times the normal volume for the stock at this time of day.
  • GTE is trading at a new high 5.06% 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 GTE:

Gran Tierra Energy Inc., an independent energy company, engages in the acquisition, exploration, development, and production of oil and gas properties in Colombia, Peru, and Brazil. GTE has a PE ratio of 3. Currently there are 3 analysts that rate Gran Tierra Energy a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Gran Tierra Energy has been 1.4 million shares per day over the past 30 days. Gran Tierra Energy has a market cap of $928.0 million and is part of the basic materials sector and energy industry. The stock has a beta of 0.72 and a short float of 2% with 4.87 days to cover. Shares are up 45.6% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Gran Tierra Energy as a sell. Among the areas we feel are negative, one of the most important has been an overall disappointing return on equity.

Highlights from the ratings report include:
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, GRAN TIERRA ENERGY INC has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • After a year of stock price fluctuations, the net result is that GTE's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Oil, Gas & Consumable Fuels industry average. The net income has decreased by 0.4% when compared to the same quarter one year ago, dropping from -$44.87 million to -$45.03 million.
  • GTE, with its decline in revenue, slightly underperformed the industry average of 24.5%. Since the same quarter one year prior, revenues fell by 24.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • GRAN TIERRA ENERGY INC has improved earnings per share by 6.3% in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, GRAN TIERRA ENERGY INC reported poor results of -$0.94 versus -$0.51 in the prior year.

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