Triangle Pattern Suggests a Significant Move in SM Energy Company (SM) Soon

A symmetrical triangle pattern has emerged in the chart of SM Energy Company (SM). When this pattern is broken, a strong move is expected…

SM Energy Company (SM) is an independent energy company engaged in the acquisition, exploration, development, and production of crude oil and condensate, natural gas, and natural gas liquids.

The company relies on its fleet of geologists, geophysicists, landmen, and engineers to help extract the full potential out of all properties held. The company’s oil and gas investments, diverse portfolio of proved reserves, and drilling opportunities are helping to create long-term value for shareholders.

SM’s balance sheet is concerning as it has a current ratio under 1 (0.4), which indicates it doesn’t have enough liquidity to handle short-term obligations. Its profitability numbers are also negative. In its most recently reported quarter, the company’s earnings rose from -0.04 to $0.02 and its revenue fell from $451.7 to $320.3 million.

SM’s price-to-sales ratio of 1.8 is in line with the industry average, while its price to book is lower. The stock had been trending up since November, but has shown mixed performance as of late. This has resulted in a Momentum Grade of B in our POWR Ratings service.

Take a look at the 1-year chart of SM below with my added notations…

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