Bearish signal generated on PBF Energy
The oil and gas exploration and production sector have lagged the overall market over the past year. The SPDR Oil & Gas Exploration and Production ETF (NYSE: XOP) is down just over 40% in the past year while the S&P 500 is up 3.55%. However, over the last two weeks, the sector has rallied sharply and the XOP is up 14.9% while the S&P is up 3.84%. The relative strength for the sector has been strong, but that strength has put many stocks in the sector in overbought territory.
One such stock is PBF Energy (NYSE: PBF). PBF has rallied over 20% in the last few weeks and the daily stochastic readings are in overbought territory. The indicators did, however, make a bearish crossover on September 10.
The 10-day RSI is close to overbought territory at 68.70 and that is the highest reading for the indicator since the end of June. What we see on the chart is that the stock peaked on June 30, right as the RSI and stochastic readings were both in overbought territory. From that day through mid-August, the stock fell over 30%. Could the stock be setting up for a repeat downturn?
It is also worth noting that the stock has been below its 50-day moving average for over a month now. The stock did move above the moving average on September 10, but it pulled back at the end of the day and closed just above the trend line.
In addition to the bearish crossover from the stochastic readings and the overbought level on the RSI, the higher Bollinger Band was broken on September 5 and the stock has remained above the upper band. According to the Tickeron Technical Analysis Overview, a price fall is expected as the ticker heads toward the middle band. In 27 of 43 cases where PBF's price broke its higher Bollinger Band, its price dropped further during the following month. The odds of a continued downtrend are 63%.
Looking at the fundamentals for PBF, the company hasn’t performed very well in recent years. The Tickeron Valuation Rating of 89 indicates that the company is significantly overvalued in the industry. A rating of 1 points to the most undervalued stocks, while a rating of 100 points to the most overvalued stocks.
The Tickeron Profit vs. Risk Rating for this company is 93, indicating that the returns do not compensate for the risks. PBF’s unstable profits reported over time resulted in significant drawdowns within the last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating for the industry is 87, placing this stock worse than average.
The Tickeron SMR rating for this company is 97, indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents.
Digging deeper in to the stats that make up the SMR rating, PBF saw earnings decline by 40% in the most recent quarter as sales were down 12%. The return on equity for the company is 15.5% and that is average. However, the profit margin is only 2.0% and that is well below average.
In addition to the downward trend from the technical side and poor fundamentals, the Tickeron Trend Prediction Engine generated a bearish signal for PBF on September 9. The signal showed a confidence level of 72% and it calls for a decline of at least 4% within the next month. Past predictions on PBF have been successful 88% of the time.
PBF sees MACD Histogram crosses below signal line
PBF saw its Moving Average Convergence Divergence Histogram (MACD) turn negative on April 10, 2024. This is a bearish signal that suggests the stock could decline going forward. Tickeron's A.I.dvisor looked at 37 instances where the indicator turned negative. In of the 37 cases the stock moved lower in the days that followed. This puts the odds of a downward move at .
Technical Analysis (Indicators)
Bearish Trend Analysis
The 10-day RSI Indicator for PBF moved out of overbought territory on April 08, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 43 similar instances where the indicator moved out of overbought territory. In of the 43 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Momentum Indicator moved below the 0 level on April 16, 2024. You may want to consider selling the stock, shorting the stock, or exploring put options on PBF as a result. In of 79 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where PBF declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
Bullish Trend Analysis
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. of 59 cases where PBF's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where PBF advanced for three days, in of 300 cases, the price rose further within the following month. The odds of a continued upward trend are .
PBF may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In of 287 cases where PBF Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Fundamental Analysis (Ratings)
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 72, placing this stock better than average.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.076) is normal, around the industry mean (10.699). P/E Ratio (3.546) is within average values for comparable stocks, (24.687). Projected Growth (PEG Ratio) (0.000) is also within normal values, averaging (0.940). Dividend Yield (0.015) settles around the average of (0.059) among similar stocks. P/S Ratio (0.199) is also within normal values, averaging (0.687).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. PBF’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
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General Information
an operator of petroleum refiners and suppliers
Industry OilRefiningMarketing