Are you looking for mid-sized companies that still have room to grow? Interested in gaining exposure to basic materials companies? Do you prefer investing in stocks that analysts have weighed in on? Company liquidity is an important consideration in any stock analysis. Liquidity gives a company the ability to make big acquisitions if it sees investment opportunities, it is a cushion for future lulls in demand, and most importantly, it keeps a company's doors open. Are these the types of stocks that you're looking for? For a closer look at stocks of this nature, we ran a screen.
The Current ratio is a liquidity ratio used to determine a company's financial health. The metric illustrates how easily a firm can pay back its short obligations all at once through current assets. A company that has a current ratio of one or less is generally a liquidity red flag. Now this doesn't mean the company will go bankrupt tomorrow, but it also doesn't bode well for the company, and may indicate that it could have an issue paying back upcoming obligations.
The Quick ratio measures a company's ability to use its cash or assets to extinguish its current liabilities immediately. Quick assets include assets that presumably can be converted to cash at close to their book values. A company with a Quick Ratio of less than 1 cannot currently pay back its current liabilities. The quick ratio is more conservative than the Current Ratio because it excludes inventory from current assets, since some companies have difficulty turning their inventory into cash. If short-term obligations need to be paid off immediately, sometimes the current ratio would overestimate a company's short-term financial strength. In general, the higher the ratio, the greater the company's liquidity (i.e., the better able to meet current obligations using liquid assets).
We first looked for mid cap basic materials stocks. We next screened for businesses that analysts rate as "Buy" (2 < mean recommendation < 3). Next, we then screened for businesses that have a substantial amount of cash on hand (Current Ratio>2)(Quick Ratio>2).
Do you think these mid-cap stocks hold solid value? Use our screened list as a starting point for your own analysis.
1) Albemarle Corp. (NYSE:ALB)
Albemarle Corp. has a Analysts' Rating of 2.30 and Current Ratio of 3.39 and Quick Ratio of 2.33. The short interest was 2.25% as of 05/20/2012. Albemarle Corporation develops, manufactures, and markets engineered specialty chemicals. The company's Polymer Solutions segment provides brominated, mineral, and phosphorus based flame retardants used in plastic enclosures for consumer electronics, printed circuit boards, wire and cable, electrical connectors, textiles, foam insulation, and foam seating in furniture and automobiles; and plastic and other additives, such as curatives, antioxidants, and stabilizers. Its Catalysts segment offers refinery catalysts, including hydroprocessing catalysts, fluidized catalytic cracking catalysts, and additives; organometallic co-catalysts, and metallocene components and co-catalysts for the manufacture of commodity and specialty plastics used in packaging, non-packaging, films, and injection molding; electronic materials, such as high purity metal organic products used in the production of light emitting diodes, as well as other products used in the production of solar cells; and chemical catalysts used in the production of ethylene dichloride and methylamines. The company's Fine Chemistry segment provides elemental bromine, alkyl bromides, inorganic bromides, brominated powdered activated carbon, and bromine fine chemicals used in chemical synthesis, oil and gas well drilling and completion fluids, mercury control, paper manufacturing, water purification, and beef and poultry processing.
2) Helmerich & Payne Inc. (NYSE:HP)
|Industry:||Oil & Gas Drilling & Exploration|
Helmerich & Payne Inc. has a Analysts' Rating of 2.40 and Current Ratio of 2.59 and Quick Ratio of 2.43. The short interest was 4.79% as of 05/20/2012. Helmerich & Payne, Inc. engages in the contract drilling of oil and gas wells. It provides drilling rigs, equipments, personnel, and camps on a contract basis to explore for and develop oil and gas from onshore areas and fixed platforms, tension-leg platforms, and spars in offshore areas. The company conducts land drilling operations primarily in Oklahoma, California, Texas, Wyoming, Colorado, Louisiana, Mississippi, Pennsylvania, Utah, Arkansas, New Mexico, Alabama, Montana, North Dakota, and West Virginia; offshore drilling operations in the Gulf of Mexico, offshore of California, Trinidad, and Equatorial Guinea; and international land drilling operations in Ecuador, Colombia, Argentina, Mexico, Tunisia, and Bahrain.
3) Cobalt International Energy, Inc. (NYSE:CIE)
|Industry:||Independent Oil & Gas|
Cobalt International Energy, Inc. has a Analysts' Rating of 1.80 and Current Ratio of 9.05 and Quick Ratio of 8.82. The short interest was 1.18% as of 05/20/2012. Cobalt International Energy, Inc., a development stage company, operates as an independent oil-focused exploration and production company. It focuses on the deepwater of the United States Gulf of Mexico, and offshore Angola and Gabon in West Africa. The company has strategic relationships with TOTAL E&P USA, INC.
4) Atwood Oceanics, Inc. (NYSE:ATW)
|Industry:||Oil & Gas Drilling & Exploration|
Atwood Oceanics, Inc. has a Analysts' Rating of 2.20 and Current Ratio of 2.76 and Quick Ratio of 2.21. The short interest was 6.86% as of 05/20/2012. Atwood Oceanics, Inc., an offshore drilling contractor, engages in the drilling and completion of exploratory and developmental oil and gas wells worldwide. The company owns 10 mobile offshore drilling units located in the U.S.
5) Dril-Quip, Inc. (NYSE:DRQ)
|Industry:||Oil & Gas Equipment & Services|
Dril-Quip, Inc. has a Analysts' Rating of 2.40 and Current Ratio of 5.47 and Quick Ratio of 3.45. The short interest was 8.06% as of 05/20/2012. Dril-Quip, Inc. designs, manufactures, fabricates, inspects, assembles, tests, and markets engineered offshore drilling and production equipment for use in deepwater, harsh environment, and severe service applications worldwide. Its principal products include subsea and surface wellheads, subsea and surface production trees, subsea control systems and manifolds, mudline hanger systems, specialty connectors and associated pipes, drilling and production riser systems, liner hangers, and wellhead connectors and diverters. The company's products are used to explore for oil and gas on offshore drilling rigs, such as floating rigs and jack-ups.
6) Allied Nevada Gold Corp. (NYSEMKT:ANV)
Allied Nevada Gold Corp. has a Analysts' Rating of 1.80 and Current Ratio of 10.62 and Quick Ratio of 7.24. The short interest was 5.55% as of 05/20/2012. Allied Nevada Gold Corp., together with its subsidiaries, engages in the evaluation, acquisition, exploration, and advancement of gold exploration and development projects. It principally operates the Hycroft Mine, an open pit heap leach gold and silver mine covering approximately 61,389 acres of mineral rights located in the west of Winnemucca, Nevada. The company is also involved in the exploration and development of various exploration properties, including Hasbrouck, Mountain View, Three Hills, Wildcat, Maverick Springs, and Pony Creek/Elliot Dome projects.
*Company profiles were sourced from Finviz. Financial data was sourced from Finviz.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.