Story updated at 10 a.m. to reflect market activity.
Wisconsin Energy fell -1.2%to $47.02 in morning trading.
The firm set a price target of $44 for the electricity provides. UBS analysts said the downgrade is due to a valuation call.
Seprately, TheStreet Ratings team rates WISCONSIN ENERGY CORP as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
"We rate WISCONSIN ENERGY CORP (WEC) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, good cash flow from operations, increase in stock price during the past year and increase in net income. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth greatly exceeded the industry average of 30.1%. Since the same quarter one year prior, revenues rose by 32.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- WISCONSIN ENERGY CORP has improved earnings per share by 19.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, WISCONSIN ENERGY CORP increased its bottom line by earning $2.51 versus $2.35 in the prior year. This year, the market expects an improvement in earnings ($2.60 versus $2.51).
- Net operating cash flow has increased to $385.10 million or 16.59% when compared to the same quarter last year. In addition, WISCONSIN ENERGY CORP has also vastly surpassed the industry average cash flow growth rate of -57.14%.
- The stock price has risen over the past year, but, despite its earnings growth and some other positive factors, it has underperformed the S&P 500 so far. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. When compared to other companies in the Multi-Utilities industry and the overall market, WISCONSIN ENERGY CORP's return on equity has significantly outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
- You can view the full analysis from the report here: WEC Ratings Report