At the moment, the debt-to-equity of SM Energy Company (NYSE:SM) is high, standing at 121.47, a figure that is higher than the 110.42 average recorded by the industry. This means that the company is currently holding a debt level at 2.59 B. SM shares have a strong debt-to-equity ratio but their quick ratio which reads 0.60 is strong and might cause problems for them later in the future.

Even though there was a rise of +54.26% in revenue, the company failed to succeed in outperforming the industry average of 28.15%. For the most recent quarter, the net income has dropped by -52.53%. This weakness in their income has affected them and thus increased their earnings to $278.76 M. The -1.34% yoy growth of SM’s revenue has gone down that of the industry average by -12.25%. For the past 12 months, SM Energy Company revenue has gone up by 10.91%. The sustained growth in their revenue has helped boost their earnings per share.

They have recorded a -901.13% declining earnings per share earnings. They have recorded a -901.13% declining earnings per share earnings. Analysts expect increase in earnings is also on the cards next quarter with an average estimate at $0.16.

The 12-month return on equity has significantly fallen to -14.92 in comparison to the same data for other companies in the same industry. This shows that there is a major weakness within the organization over the past one year. Comparing them to other companies in the industry and the overall Basic Materials sector, the industry average is 18.52 while 13.97 is of the sector.

SM total operating cash flow had jumped to $229.66 billion compared to $171.38 billion in the same quarter last year. Also, looking at the price to cash flow of the company and the industry average, the 5.13 ratio of the stock is lower than the industry’s 6.10.

In addition to their unfavorable P/E ratio, SM Energy Company has maintained a gross margin of 56.38. This shows whether the company has what it takes to effectively turn the revenue into profit.

The company’s ROA is -5.10 when compared to 4.97 for the stocks operating in the same industry. This can be attributed to the strength recorded in the net income produced by total assets. Comparing it to other companies in the sector, SM Energy Company ROE is above 13.97 that of both the sector average.

The operating profit margin for SM Energy Company (SM) is -21.86%, a figure which is considered to be weak. It has gone -10.68 from the -1.39 over the past 5 years. In addition to this, their operating margin is -11.18 lower than the industry average.

The net profit margin which stood at -4.69 on average in the past 5 years has dropped to -22.11 in the last 12 months. Added to that, this ratio has missed the industry net margin that stands at 17.85.

Analysts meanwhile rate SM Energy Company (NYSE:SM) as a buy. Still some above discussed indicators of the $2.11B company show strength while others show weakness. There is little evidence at the moment to justify the expectation of the SM shares to either perform positively or negatively when compared to other stocks. The primary strengths of SM Energy Company can be witnessed in its increased revenue, growing earnings per share, higher return on equity, increased operating cash and high net margin. Subsequently, financial analysis have also identified some weak areas that includes high debt, relatively high P/E ratio, lower return on assets and low net margin.