NEW YORK (TheStreet) -- Shares of NuStar Energy (NS - Get Report) are up 1.33% to $57.71 following a ratings upgrade to "buy" from "hold" at Stifel Financial Corp. (SF - Get Report) due to the company's strong first quarter 2014 results.
The firm said the company, which is engaged in the terminalling and storage of petroleum products, has seen its strongest first quarter results since 2009.
NuStar Energy reported distributable cash flow from continuing operations available to limited partners of $77.9 million, or $1.00 per unit, compared to the same quarter in 2013, when it reported $57.1 million, or $0.73 per unit.
The company also said its first quarter earnings before interest, taxes, depreciation and amortization is $126.7 million compared to $94.1 million reported in first quarter 2013.
NuStar announced a net income for the first quarter 2014 of $28.1 million, or $0.36 per unit versus the $13.3 million, or $0.17 per unit it reported during the same quarter in 2013.
TheStreet Ratings team rates NUSTAR ENERGY LP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate NUSTAR ENERGY LP (NS) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Net operating cash flow has significantly increased by 290.42% to $106.68 million when compared to the same quarter last year. In addition, NUSTAR ENERGY LP has also vastly surpassed the industry average cash flow growth rate of -22.97%.
- NUSTAR ENERGY LP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, NUSTAR ENERGY LP continued to lose money by earning -$2.89 versus -$3.05 in the prior year. This year, the market expects an improvement in earnings ($1.92 versus -$2.89).
- NS, with its decline in revenue, underperformed when compared the industry average of 7.6%. Since the same quarter one year prior, revenues fell by 20.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, NUSTAR ENERGY LP's return on equity significantly trails that of both the industry average and the S&P 500.
- 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 3335.5% when compared to the same quarter one year ago, falling from -$10.62 million to -$364.82 million.
- You can view the full analysis from the report here: NS Ratings Report