Centrais Eletricas Brasileiras (NYSE: EBR) shares currently have a dividend yield of 7.60%. Centrais Eletricas Brasileiras S.A. Eletrobras, together with its subsidiaries, engages in the generation, transmission, and distribution of electricity in Brazil. It projects, builds, and operates generating power plants, and electric power transmission and distribution lines. The average volume for Centrais Eletricas Brasileiras has been 1,079,500 shares per day over the past 30 days. Centrais Eletricas Brasileiras has a market cap of $3.0 billion and is part of the utilities industry. Shares are down 29.2% year to date as of the close of trading on Monday. TheStreet Ratings rates Centrais Eletricas Brasileiras as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share. Highlights from the ratings report include:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Electric Utilities industry. The net income has significantly decreased by 102.5% when compared to the same quarter one year ago, falling from $696.49 million to -$17.71 million.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Electric Utilities industry and the overall market, ELETROBRAS-CENTR ELETR BRAS's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for ELETROBRAS-CENTR ELETR BRAS is currently extremely low, coming in at 0.31%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -0.61% trails that of the industry average.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 66.05%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 101.92% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- ELETROBRAS-CENTR ELETR BRAS has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, ELETROBRAS-CENTR ELETR BRAS swung to a loss, reporting -$2.48 versus $1.48 in the prior year. This year, the market expects an improvement in earnings ($0.74 versus -$2.48).
- You can view the full Centrais Eletricas Brasileiras Ratings Report.
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