NEW YORK (TheStreet) -- Shares of Portland General Electric Co. (POR) - Get Portland General Electric Company Report closed down by 1.65% to $35.80 on heavy trading volume on Monday, as Barclays downgraded the stock to "underweight" from "equal weight" and lowered its price target to $35 from $37.
The Portland, OR-based company has been a beneficiary of solid growth from resource additions in the last five years, the firm said, however, their earnings growth profile will slow when the Carty Generating Station is completed this year.
"Uncertainty surrounding the completion of Carty based on removal of the general contractor, and the associated uncertainty regarding rate recovery in 2016 combined with below average earnings growth through 2018 results in our downgrade to Underweight," the firm said in an analyst note.
Barclays analysts are also waiting for clarity on a new schedule and cost estimate for the plant.
About 1.17 million of the company's shares were traded on Monday, compared to the company's average of 756,863 shares per day.
Portland General Electric is a vertically integrated electric utility company engaged in the generation, wholesale purchase, transmission, distribution and retail sale of electricity in the state of Oregon.
Separately, recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate PORTLAND GENERAL ELECTRIC CO as a Buy with a ratings score of A-. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Net operating cash flow has increased to $191.00 million or 11.69% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -7.28%.
- The debt-to-equity ratio is somewhat low, currently at 0.99, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.48 is very weak and demonstrates a lack of ability to pay short-term obligations.
- POR, with its decline in revenue, slightly underperformed the industry average of 0.6%. Since the same quarter one year prior, revenues slightly dropped by 1.6%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- PORTLAND GENERAL ELECTRIC CO's earnings per share declined by 16.7% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, PORTLAND GENERAL ELECTRIC CO increased its bottom line by earning $2.19 versus $1.35 in the prior year. For the next year, the market is expecting a contraction of 4.1% in earnings ($2.10 versus $2.19).
- The gross profit margin for PORTLAND GENERAL ELECTRIC CO is currently lower than what is desirable, coming in at 30.25%. Regardless of POR's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 7.56% trails the industry average.
- You can view the full analysis from the report here: POR