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 sell with a ratings score of D . The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk and disappointing return on equity.
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Highlights from the ratings report include:
- The debt-to-equity ratio is very high at 2.57 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.31, which clearly demonstrates the inability to cover short-term cash 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. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, KINDER MORGAN INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- Compared to where it was a year ago today, the stock is now trading at a higher level, and has traded in line with the S&P 500. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry, implying reduced upside potential.
- 46.30% is the gross profit margin for KINDER MORGAN INC which we consider to be strong. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 7.00% trails the industry average.
- Net operating cash flow has increased to $914.00 million or 47.41% when compared to the same quarter last year. In addition, KINDER MORGAN INC has also vastly surpassed the industry average cash flow growth rate of -15.36%.
Kinder Morgan, Inc. owns and operates energy transportation and storage assets in the United States and Canada. The company operates in six segments: Products Pipelines-KMP, Natural Gas Pipelines KMP, CO2 KMP, Terminals KMP, Kinder Morgan Canada KMP, and NGPL PipeCo LLC. Kinder Morgan has a market cap of $35.02 billion and is part of the basic materials sector and energy industry. The company has a P/E ratio of 66.2, above the S&P 500 P/E ratio of 17.7. Shares are up 4.9% year to date as of the close of trading on Wednesday.
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--Written by a member of TheStreet Ratings Staff.
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