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 revenue growth, reasonable valuation levels and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and poor profit margins.
Highlights from the ratings report include:
- The revenue growth significantly trails the industry average of 39.6%. Since the same quarter one year prior, revenues slightly increased by 1.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Although SU's debt-to-equity ratio of 0.29 is very low, it is currently higher than that of the industry average. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.87 is somewhat weak and could be cause for future problems.
- The gross profit margin for SUNCOR ENERGY INC is rather low; currently it is at 23.50%. Regardless of SU'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 5.90% trails the industry average.
- SU has underperformed the S&P 500 Index, declining 6.40% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
Suncor Energy Inc., together with its subsidiaries, operates as an integrated energy company. The company has a P/E ratio of 15.3, equal to the average energy industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Suncor Energy has a market cap of $47.3 billion and is part of the
industry. Shares are down 22.7% year to date as of the close of trading on Tuesday.
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