Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of A. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, increase in net income and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
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Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 9.7%. Since the same quarter one year prior, revenues rose by 16.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The gross profit margin for EOG RESOURCES INC is currently very high, coming in at 81.40%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 15.55% is above that of the industry average.
- Net operating cash flow has increased to $1,424.94 million or 32.23% when compared to the same quarter last year. In addition, EOG RESOURCES INC has also vastly surpassed the industry average cash flow growth rate of -23.08%.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 52.7% when compared to the same quarter one year prior, rising from $324.01 million to $494.73 million.
- The current debt-to-equity ratio, 0.46, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.98 is somewhat weak and could be cause for future problems.
EOG Resources, Inc., together with its subsidiaries, engages in the exploration, development, production, and marketing of crude oil and natural gas. EOG has a market cap of $35.6 billion and is part of the basic materials sector and energy industry. The company has a P/E ratio of 48.00, above the S&P 500 P/E ratio of 18.00. Shares are up 8.3% year to date as of the close of trading on Friday.
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--Written by a member of TheStreet Ratings Staff.
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