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NEW YORK (
) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, compelling growth in net income and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows low profit margins.
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Highlights from the ratings report include:
- ELP's revenue growth has slightly outpaced the industry average of 9.4%. Since the same quarter one year prior, revenues rose by 14.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- ELP's debt-to-equity ratio is very low at 0.28 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- The net income growth from the same quarter one year ago has exceeded that of the Electric Utilities industry average, but is less than that of the S&P 500. The net income increased by 22.7% when compared to the same quarter one year prior, going from $193.90 million to $237.92 million.
- COPEL-CIA PARANAENSE ENERGIA has improved earnings per share by 22.5% 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 year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, COPEL-CIA PARANAENSE ENERGIA increased its bottom line by earning $3.53 versus $2.67 in the prior year. For the next year, the market is expecting a contraction of 48.4% in earnings ($1.82 versus $3.53).
Companhia Paranaense de Energia - COPEL is engaged in the generation, transmission, distribution, and sale of electricity to industrial, residential, commercial, and rural customers primarily in the State of Parana, Brazil. Energy Company of Parana has a market cap of $4.12 billion and is part of the utilities sector and utilities industry. Shares are up 16.2% year to date as of the close of trading on Friday.
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