Skip to main content

NEW YORK (TheStreet) -- Shares of Enterprise Products Partners (EPD) - Get Enterprise Products Partners L.P. Report are higher by 3.50% to $26.50 in mid-afternoon trading on Wednesday, as the rally in oil prices drives some energy and related stocks into the green today.

Although oil prices gave up some gains after the Federal Reserve said it would leave interest rates near zero, U.S. crude prices are still trading over 6% and Brent is up by almost 5%.

Oil prices rebounded from Tuesday's lows following data from the U.S. government reporting a rise in crude stockpiles but a decline in gasoline and distillate inventories for last week, Reuters reports.

The Energy Information Administration's report showed a 3.4 million barrel increase in crude to 480 million barrels for the week ended October 23. However, stockpiles at the Cushing, Ok-based delivery hub fell by 785,000 barrels.

Gasoline supplies dropped by 1.1 million barrels, while analysts surveyed by Reuters had forecast a decline of 817,000 barrels. Distillate stockpiles, which include diesel and heating oil, were reduced by 3 million barrels versus the 1.7 million barrel drop that was expected.

Scroll to Continue

TheStreet Recommends

Houston-based Enterprise Partners provides midstream energy services to producers and consumers of natural gas, natural gas liquids (NGLs), crude oil, petrochemicals and refined products.

The company will release its 2015 third quarter earnings results before the market open Thursday.

Separately, TheStreet Ratings team rates ENTERPRISE PRODS PRTNRS -LP as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

We rate ENTERPRISE PRODS PRTNRS -LP (EPD) 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 reasonable valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Net operating cash flow has significantly increased by 102.56% to $947.60 million when compared to the same quarter last year. In addition, ENTERPRISE PRODS PRTNRS -LP has also vastly surpassed the industry average cash flow growth rate of -19.46%.
  • EPD, with its decline in revenue, slightly underperformed the industry average of 34.1%. Since the same quarter one year prior, revenues fell by 43.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The debt-to-equity ratio of 1.11 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, EPD has a quick ratio of 0.61, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • 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. When compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, ENTERPRISE PRODS PRTNRS -LP's return on equity is below that of both the industry average and the S&P 500.
  • You can view the full analysis from the report here: EPD