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Today's Major Energy Sector Movers: Apache and More
The market has been slipping so far today. The Nasdaq is down 0.4%; the S&P 500 has fallen 0.8%; and the Dow has decreased 0.8%. 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) is currently lagging behind the overall market, down 1.7%, and its current biggest movers are:
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Shares of World Fuel (NYSE:INT) are currently trading at $34.40, a steep decline of 15.6%. So far today, the company's volume is 1.1 million shares. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. 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 price/book value ratio is calculated by dividing the current stock price by the company's book value per share. INT's stock is trading for more than its book value with a P/B ratio of 1.79. This may be a sign that the company is overvalued. P/B has its shortcomings but is still widely used as a valuation metric, more relevant for use by investors looking at capital-intensive or finance-related businesses, such as banks; book value does not carry much meaning for service-based firms with few tangible assets. SEE: Investment Valuation Ratios: Price/Book Value Ratio
After a precipitous drop of 13%, Bill (NYSE:BBG) is now trading at a share price of $18.36. With 1.6 million shares changing hands so far today, the company's volume is 1.3 times the average volume over the last three months. If a stock price makes a big move up or down, volume lets us know the significance of that move. 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. There are generally two price/earnings ratios calculated: the first, called the trailing Price/Earnings ratio, is calculated using the previous years actual earnings; the second, called forward Price/Earnings ratio, is calculated using the next year's estimated earnings. BBG's P/E ratio of 19.5 falls below the industry average of 35.68. Companies with low P/E ratios may find it easier to surprise the market to the upside, even if their financial performance is not as strong as that of companies with high P/E ratios. High P/E stocks could be "growth" stocks, while low PE stocks may be "value" stocks. SEE: Profit With The Power Of Price-To-Earnings
Stone (NYSE:SGY) is currently trading at $23.34 per share, after a steep drop of 11.4%. So far today, the company's volume is 1.3 million shares. This is more trading activity than there was yesterday. 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 assumption with high price/earnings stocks (generally of the growth variety) is that investors are willing to buy at a high price because they believe that the stock has significant growth potential, and the price/earnings to growth (PEG) ratio helps investors determine the degree of reliability of that growth assumption. SGY's PEG ratio is -0.54. While P/E ratios are important indicators of market value, a high P/E in and of itself is not bad because it may indicate a company whose earnings are growing very rapidly, so many investors look at the PEG ratio in order to get an idea of whether or not a particular P/E ratio is justified by underlying earnings growth.
After a big jump of 11.3%, Tesoro (NYSE:TSO) is trading at $30.95 per share. At 7.5 million shares, the company's volume so far today is two times the average daily volume. If a stock price moves on high volume, this means that the change is a significant one. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. The price/sales ratio is used for spotting recovery situations or for double-checking that a company's growth has not become overvalued. TSO has a P/S ratio of 0.12, on the low end. Low P/S ratios can indicate unrecognized value potential - so long as other criteria like high profit margins, low debt levels and growth prospects are in place. A limitation of the P/S ratio is that the price component measures only stock market captialization, while sales are a function of the entire capital structure, potentially leading to wide differences between levered and unlevered companies.
Shares of SM (NYSE:SM) are currently trading at $42, a steep decline of 11.2%. This morning, the company is trading a volume of 3.1 million shares. A stock's volume conveys how excited investors are about it. Understanding investment valuation ratios allows an investor to assess the true value of an individual stock. The debt ratio is calculated by dividing total liabilities by total assets. SM's debt ratio of 61.2% is fairly high. 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.
Halcon (NYSE:HK) has increased to a share price of $6.75, a 7.8% rise. The company's volume is currently 1.5 million shares for the day, 0.7 times its average over the past three months. Volume is an important indicator because it indicates how significant a price shift is. When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. The debt-equity (D/E) ratio is a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed. HK's D/E ratio is 63%. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.
Apache (NYSE:APA) is down 5.2% to reach $82.37 per share. The company's volume is currently 2.1 million shares. Price change alone is not enough to know how a stock is doing. Volume is an important secondary indicator used to confirm trends suggested by price movement. Investment valuation ratios provide investors with an estimation, albeit a simplistic one, of the value of a stock. The capitalization ratio is calculated by dividing long-term debt by the sum of long-term debt and shareholders' equity. APA's capitalization ratio is 20%, which is relatively low. A very low capitalization ratio might be a sign that the company is stagnating and reducing the potential earnings for shareholders. The capitalization ratio is one of the more meaningful debt ratios because it focuses on the relationship of debt liabilities as a component of a company's total capital base, which is the capital raised by shareholders and lenders.
The Bottom Line On any given day, a particular stock may see positive or negative change in its share price. It is important to weigh current activity against historical performance when making any investment decisions. 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.
The Energy sector (XLE) is currently lagging behind the overall market, down 1.7%, and its current biggest movers are:
| Company | Market Cap | Percentage Change |
| World Fuel Services Corporation (NYSE:INT) | $2.93 billion | -15.6% |
| Bill Barrett Corporation (NYSE:BBG) | $1.02 billion | -13% |
| Stone Energy Corporation (NYSE:SGY) | $1.3 billion | -11.4% |
| Tesoro (NYSE:TSO) | $3.9 billion | +11.3% |
| SM Energy Co. (NYSE:SM) | $3.03 billion | -11.2% |
| Halcon Resources Corp (NYSE:HK) | $901.6 million | +7.8% |
| Apache (NYSE:APA) | $33.95 billion | -5.2% |
Shares of World Fuel (NYSE:INT) are currently trading at $34.40, a steep decline of 15.6%. So far today, the company's volume is 1.1 million shares. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. 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 price/book value ratio is calculated by dividing the current stock price by the company's book value per share. INT's stock is trading for more than its book value with a P/B ratio of 1.79. This may be a sign that the company is overvalued. P/B has its shortcomings but is still widely used as a valuation metric, more relevant for use by investors looking at capital-intensive or finance-related businesses, such as banks; book value does not carry much meaning for service-based firms with few tangible assets. SEE: Investment Valuation Ratios: Price/Book Value Ratio
After a precipitous drop of 13%, Bill (NYSE:BBG) is now trading at a share price of $18.36. With 1.6 million shares changing hands so far today, the company's volume is 1.3 times the average volume over the last three months. If a stock price makes a big move up or down, volume lets us know the significance of that move. 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. There are generally two price/earnings ratios calculated: the first, called the trailing Price/Earnings ratio, is calculated using the previous years actual earnings; the second, called forward Price/Earnings ratio, is calculated using the next year's estimated earnings. BBG's P/E ratio of 19.5 falls below the industry average of 35.68. Companies with low P/E ratios may find it easier to surprise the market to the upside, even if their financial performance is not as strong as that of companies with high P/E ratios. High P/E stocks could be "growth" stocks, while low PE stocks may be "value" stocks. SEE: Profit With The Power Of Price-To-Earnings
Stone (NYSE:SGY) is currently trading at $23.34 per share, after a steep drop of 11.4%. So far today, the company's volume is 1.3 million shares. This is more trading activity than there was yesterday. 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 assumption with high price/earnings stocks (generally of the growth variety) is that investors are willing to buy at a high price because they believe that the stock has significant growth potential, and the price/earnings to growth (PEG) ratio helps investors determine the degree of reliability of that growth assumption. SGY's PEG ratio is -0.54. While P/E ratios are important indicators of market value, a high P/E in and of itself is not bad because it may indicate a company whose earnings are growing very rapidly, so many investors look at the PEG ratio in order to get an idea of whether or not a particular P/E ratio is justified by underlying earnings growth.
After a big jump of 11.3%, Tesoro (NYSE:TSO) is trading at $30.95 per share. At 7.5 million shares, the company's volume so far today is two times the average daily volume. If a stock price moves on high volume, this means that the change is a significant one. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. The price/sales ratio is used for spotting recovery situations or for double-checking that a company's growth has not become overvalued. TSO has a P/S ratio of 0.12, on the low end. Low P/S ratios can indicate unrecognized value potential - so long as other criteria like high profit margins, low debt levels and growth prospects are in place. A limitation of the P/S ratio is that the price component measures only stock market captialization, while sales are a function of the entire capital structure, potentially leading to wide differences between levered and unlevered companies.
Shares of SM (NYSE:SM) are currently trading at $42, a steep decline of 11.2%. This morning, the company is trading a volume of 3.1 million shares. A stock's volume conveys how excited investors are about it. Understanding investment valuation ratios allows an investor to assess the true value of an individual stock. The debt ratio is calculated by dividing total liabilities by total assets. SM's debt ratio of 61.2% is fairly high. 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.
Halcon (NYSE:HK) has increased to a share price of $6.75, a 7.8% rise. The company's volume is currently 1.5 million shares for the day, 0.7 times its average over the past three months. Volume is an important indicator because it indicates how significant a price shift is. When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. The debt-equity (D/E) ratio is a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed. HK's D/E ratio is 63%. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.
Apache (NYSE:APA) is down 5.2% to reach $82.37 per share. The company's volume is currently 2.1 million shares. Price change alone is not enough to know how a stock is doing. Volume is an important secondary indicator used to confirm trends suggested by price movement. Investment valuation ratios provide investors with an estimation, albeit a simplistic one, of the value of a stock. The capitalization ratio is calculated by dividing long-term debt by the sum of long-term debt and shareholders' equity. APA's capitalization ratio is 20%, which is relatively low. A very low capitalization ratio might be a sign that the company is stagnating and reducing the potential earnings for shareholders. The capitalization ratio is one of the more meaningful debt ratios because it focuses on the relationship of debt liabilities as a component of a company's total capital base, which is the capital raised by shareholders and lenders.
The Bottom Line On any given day, a particular stock may see positive or negative change in its share price. It is important to weigh current activity against historical performance when making any investment decisions. 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.
by
Investopedia Staff
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