After the morning's trading, the Nasdaq is trading up 0.4%, the S&P 500 has climbed 0.1% and the Dow has declined 0.2%. The energy sector is the category of stocks that relate to producing or supplying energy. This sector includes companies involved in the exploration and development of oil or gas reserves, oil and gas drilling, or integrated power firms. Performance in the sector is largely driven by the supply and demand for worldwide energy. Energy producers will do very well during times of high oil and gas prices, but will earn less when the value of energy drops. Furthermore, this sector is sensitive to political events, which historically have driven changes in the price of oil.
The Energy sector (XLE) has moved up 0.1% so far today and here are its biggest movers:
|Company||Market Cap||Percentage Change|
|Core Laboratories (NYSE:CLB)||$5.71 billion||-14.5%|
|Sandridge Mississippian Trust (NYSE:SDT)||$689.9 million||-4.6%|
|Genesis Energy (NYSE:GEL)||$2.74 billion||-4.3%|
|Comstock Resources (NYSE:CRK)||$928.1 million||+3.7%|
|Rose Rock (NYSE:RRMS)||$520.2 million||+3.2%|
|Cenovus Energy Inc (NYSE:CVE)||$26.54 billion||+2.6%|
|CARBO Ceramics (NYSE:CRR)||$1.47 billion||-2.5%|
Beginner's Guide To Stockcharts.com
Taking a 14.5% hit, Core Laboratories (NYSE:CLB) is currently trading at $103.17 per share. At 1.5 million shares, the company's volume so far today is 4.9 times the average daily volume. Volume is used to evaluate how meaningful the price movement of a stock is. Investment valuation ratios can be very useful in estimating whether a stock price is too high, reasonable or a bargain investment opportunity. The price/earnings to growth (PEG) ratio divides a company's P/E ratio by its growth rate of earnings-per-share. PEG ratio for CLB is consistent with the industry average at 1.77. Because of the adjustment for earnings growth rate, the PEG ratio is somewhat more useful than many formulas for comparing companies in different industries.
Sandridge Mississippian Trust (NYSE:SDT) is currently trading at a share price of $23.50, a 4.6% decline. So far today, 508,787 shares have changed hands. When a stock price moves up or down, watching the volume is a good way of identifying how significant that shift is. 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. Dividend yield is a way to measure how much cash flow you are getting for each dollar invested in an equity position - in other words, how much "bang for your buck" you are getting from dividends. Dividend yield for SDT is 11.8%, which is fairly high. This could mean either that the stock is underpriced or that the company has fallen on hard times and future dividends will not be as high as previous ones. For income-oriented investors such as retirees, a stock with a high dividend yield may be more attractive than a stock with a low dividend yield. SEE: Dividend Yield For The Downturn
Slipping 4.3%, Genesis Energy (NYSE:GEL) is currently trading at $33.08 per share. The company's volume for the day so far is 1.9 million shares, 9.9 times its average over the past three months. 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 price/sales ratio is used for spotting recovery situations or for double-checking that a company's growth has not become overvalued. The P/S ratio for GEL is 0.66, which is relatively low. Coupled with high relative strength in the previous twelve months, a low P/S ratio is one of the most potent combinations of investment criteria. It is important to compare P/S ratios for companies in the same industry, as ratios can vary quite widely for companies in different industries.
Increasing 3.7%, Comstock Resources (NYSE:CRK) is trading at $19.99 per share. The company's volume is currently 842,144 shares. A stock's volume conveys how excited investors are about it. 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. CRK has a debt ratio of 60.9%, which is on the high side. This might mean that the company now has low borrowing capacity, which reduces it's financial flexibility. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.
Rose Rock (NYSE:RRMS) is up 3.2% to reach a current price of $32.00 per share. So far today, the company's volume is 7,595 shares, in keeping with its current daily average. Volume is an important indicator in technical analysis as it is used to measure the worth of a market move. If the markets have made a strong price move either up or down the perceived strength of that move depends on the volume for that period. The higher the volume during that price move the more significant the move. Valuation ratios allow the investor to make a quick determination as to a company's investment value. The price/book value ratio is especially important for value investors as it can provide an indication of the true value of a company's assets at a time when its business model may be failing. RRMS' stock is trading for more than its book value with a P/B ratio of 1.73. This may be a sign that the company is overvalued. P/B value ratios are particularly useful to value investors, distressed or "vulture" investors, or any other investors purchasing beaten-down securities but are less useful to investors focused on growth stocks, purchasing IPOs, or investing in technology or other "asset-lite" companies. SEE: Investment Valuation Ratios: Price/Book Value Ratio
Rising 2.6%, Cenovus Energy Inc (NYSE:CVE) is currently trading at $36.07 per share. The company is currently trading a volume of 630,419 shares. Volume is an important indicator because it indicates how significant a price shift is. 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. One of the most important estimates of stock market valuation is the price/earnings ratio (P/E ratio). Relative to the industry P/E ratio of 38.54, CVE's 16.7 is low. A low P/E might arise due to substantial inherent risk of the firm and its operations, poor return on equity, or improper valuation of the market. A high P/E ratio indicates a stock that is expensive, while a low P/E ratio indicates a stock that is cheap. SEE: The P/E Ratio: A Good Market-Timing Indicator
At $62.23, CARBO Ceramics (NYSE:CRR) has slipped 2.5%. So far today, the company's volume is 237,497 shares, in keeping with its current three-month average. 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. It is important for an investor to estimate the value of any potential or existing investment; valuation ratios make this easier. The dividend yield is measured by taking the annual dividends per share and dividing that number by the stock price. The dividend yield for CRR is 1.7%, which is on the low end. A company with a low dividend yield may be a safer investment in the long run. 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
The Bottom Line The nature of the market is such that stocks will have good days and bad days. Daily stock performance should be weighed against historical performance and put in context of the market overall. Tools like valuation ratios and profit margins, however, are only as useful as the context you put them in; remember to take historical data and competitor performance into account.