NEW YORK (
) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.
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Highlights from the ratings report include:
- Net operating cash flow has slightly increased to $124.99 million or 3.76% when compared to the same quarter last year. Despite an increase in cash flow, MDU RESOURCES GROUP INC's cash flow growth rate is still lower than the industry average growth rate of 14.78%.
- The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Multi-Utilities industry average. The net income has decreased by 16.7% when compared to the same quarter one year ago, dropping from $42.98 million to $35.79 million.
- 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 Multi-Utilities industry and the overall market, MDU RESOURCES GROUP INC's return on equity is below that of both the industry average and the S&P 500.
MDU Resources Group, Inc. operates as a diversified natural resource company in the United States. The company generates, transmits, and distributes electricity, as well as distributes natural gas. The company has a P/E ratio of 18.4, below the average materials & construction industry P/E ratio of 19.5 and above the S&P 500 P/E ratio of 17.7. MDU Resources Group has a market cap of $4.02 billion and is part of the
industry. Shares are down 1% year to date as of the close of trading on Monday.
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-- Written by a member of TheStreet Ratings Staff
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.