Tuesday, March 30, 2010

Quick Analysis: Petrohawk Energy Corp (HK)

Recent Range: $19/share – $28/share (Current Price: 19.97, as of close of 3/29/10)

Price/Sales (P/S) = 5.43 (6.84, Industry)

Price/Book (P/B) = 1.77 (2.32)
Gross Margin = 57.9% (63.2%)
Pre-Tax Margin = -164.3% (-39.0%)
Debt/Equity Ratio = 0.79 (0.49)
Current Ratio = 0.6 (1.5)
Return on Equity = -30.5% (2.0%)
Return on Assets = -15.1% (1.8%)
Return on Capital = -16.9% (2.5%)

Analysis: DO NOT BUY!!! SELL IF YOU HAVE IT.

This company is in debt, and it does not seem to make any money on that debt. This company seems to have negative cash flow. This company seems to be a sinking ship.

If you feel like gambling, you can play with this stock’s volatility, but to me, it seems like it’s on its way down.

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