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Tickers in this Article: SWN, CWEI, WTI, COG, SM, APC, CXO
The market is currently up, with the Nasdaq increasing 0.7%, the S&P 500 moving up 0.7% and the Dow up 0.9%.

The Oil and Gas Operations sector (DIG) is up 2.3%, outperforming the market overall. The biggest movers in the sector so far are:
CompanyMarket CapPercentage Change
Southwestern Energy (NYSE:SWN)$10.69 billion+3%
Clayton Williams Energy (Nasdaq:CWEI)$574.6 million+2.7%
W&T Offshore (NYSE:WTI)$1.29 billion-2.7%
Cabot Oil & Gas (NYSE:COG)$8.51 billion+2.6%
SM (NYSE:SM)$2.99 billion+2.5%
Anadarko (NYSE:APC)$34.11 billion+2.4%
Concho Resources (NYSE:CXO)$9.19 billion+2.2%
Broker Summary: Charles Schwab Online Brokerage

Rising 3%, Southwestern Energy (NYSE:SWN) is currently trading at $31.52 per share. So far today, the company's volume is 1.1 million shares. A stock's volume conveys how excited investors are about it. A company's investment value can be estimated using valuation ratios such as the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield. The capitalization ratio is calculated by dividing long-term debt by the sum of long-term debt and shareholders' equity. SWN's capitalization ratio is 32.2%. A low level of debt and a healthy proportion of equity in a company's capital structure is an indication of financial fitness.

Increasing 2.7%, Clayton Williams Energy (Nasdaq:CWEI) is trading at $48.50 per share. The company's volume is currently 7,689 shares for the day, lighter than yesterday's volume of 47,548 shares. Volume indicates the level of interest that investors have in a company at its current price. Investment valuation ratios provide investors with an estimation, albeit a simplistic one, of the value of a stock. The debt-equity (D/E) ratio compares the total liabilities for a company to its total shareholder equity. CWEI has a D/E ratio of 182%, which is relatively high. Companies with high D/E ratios may have difficulty attracting additional investment capital. This easy-to-calculate ratio provides a general indication of a company's equity-liability relationship and is helpful to investors looking for a quick take on a company's leverage.

After a decline of 2.7%, W&T Offshore (NYSE:WTI) has hit a share price of $16.84. The company's volume for the day so far is 261,614 shares. This is 0.6 times the current three-month average. The trading volume for a stock indicates the level of investor interest. In making a decision about a potential or existing investment, valuation ratios are useful as a basis for seeing whether the stock price is too high, reasonable, or a bargain. The price/book value ratio, often expressed simply as "price-to-book", provides investors a way to compare the market value, or what they are paying for each share, to a conservative measure of the value of the firm. WTI's P/B ratio of 2.1 shows that its share price is higher than its book value. This implies that investors expect management to create more value from a given set of assets and/or that the market value of the firm's assets is significantly higher than their accounting value. To put things in perspective, should be made among companies in the same industry rather than across industries. SEE: How Buybacks Warps The Price-To-Book Ratio

Cabot Oil & Gas (NYSE:COG) is currently trading at $41.59 per share, a 2.6% increase. The company's volume is currently 741,701 shares for the day, 0.4 times the average daily volume. If a stock is trading on low volume, then there is not much interest in the stock. On the other hand, if a stock is trading on high volume, then there is a lot of interest in the stock. Valuation ratios include the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield. The dividend yield is measured by taking the annual dividends per share and dividing that number by the stock price. COG has a low dividend yield of 0.2%. If you are an income investor, this stock may not be attractive to you. Simply comparing the level of dividends that two stocks pay does not give a true reflection of which security is more attractive, so investors calculate the dividend yield in order to standardize dividend payments. SEE: Investment Valuation Ratios: Dividend Yield

SM (NYSE:SM) has risen 2.5% to hit a current price of $47.08 per share. This morning, the company is trading a volume of 215,750 shares. High volume indicates a lot of investor interest while low volume indicates the opposite. Valuation ratios allow the investor to make a quick determination as to a company's investment value. One of the most important estimates of stock market valuation is the price/earnings ratio (P/E ratio). Compared to the industry average of 14.85, SM's P/E ratio of 19.4 is quite high. This could mean that the market is expecting big things over the next few months or years. To determine the P/E ratio, an investor divides the market price of the stock by the earnings-per-share (EPS) of the stock. SEE: Can Investors Trust the P/E Ratio?

After an increase of 2.4%, Anadarko (NYSE:APC) has reached a current price of $69.90. So far today, 1.2 million shares have changed hands, with trading activity in keeping with yesterday's. Volume is used to evaluate how meaningful the price movement of a stock is. A wide array of ratios can be used by investors to estimate the attractiveness of a potential or existing investment and get an idea of its valuation. The debt ratio gives users a quick measure of the amount of debt that the company has on its balance sheets compared to its assets. APC has a high debt ratio of 62.7%. This means that most of the company's assets are financed through debt. However, one thing to note with this ratio: it isn't a pure measure of a company's debt (or indebtedness), as it also includes operational liabilities, such as accounts payable and taxes payable.

Concho Resources (NYSE:CXO) has increased to a share price of $90.07, a 2.2% rise. This morning, the company is trading a volume of 300,882 shares. This is in keeping with its current three-month average. Volume indicates the level of interest that investors have in a company at its current price. Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. The price/sales ratio measures a company's stock market value by its total revenues or alternatively, a company's price per share by its revenue per share. CXO's P/S ratio of 4.74 is on the high side. In young companies, a high P/S ratio is a sign of sales growth that is expected to turn into earnings and cash flow. It is important to keep in mind when looking at the P/S ratio that just because a company is generating revenues, this does not mean that the company is profitable, and in the long run, profits drive stock prices.

The Bottom Line The nature of the market is such that stocks will have good days and bad days. Paying close attention to the previous ratios will help you identify key times to adjust your strategy. However, these fundamental metrics must be analyzed with historic data, industry information in addition to firm specific financial statements.

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