CenterPoint Energy Inc

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CNP : NYSE : Utilities
$28.05 | %
Today's Range: 27.94 - 28.18
Avg. Daily Volume: 2722900.0
06/23/17 - 4:03 PM ET

Financial Analysis


CENTERPOINT ENERGY INC's gross profit margin for the first quarter of its fiscal year 2017 has significantly decreased when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. CENTERPOINT ENERGY INC has weak liquidity. Currently, the Quick Ratio is 0.79 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

During the same period, stockholders' equity ("net worth") has remained unchanged from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY17 Q1 FY16
Net Sales ($mil)2735.01984.0
EBITDA ($mil)500.0510.0
EBIT ($mil)274.0250.0
Net Income ($mil)192.0154.0


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)1251.01112.0
Total Assets ($mil)21931.021004.0
Total Debt ($mil)8679.08478.0
Equity ($mil)3537.03506.0


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin18.2825.71
EBITDA Margin18.2825.7
Operating Margin10.0212.6
Sales Turnover0.380.33
Return on Assets2.14-3.18
Return on Equity13.28-19.08
Debt Q1 FY17 Q1 FY16
Current Ratio1.10.92
Debt/Capital0.710.71
Interest Expense100.0113.0
Interest Coverage2.742.21


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)430.96430.62
Div / share0.270.26
EPS0.440.36
Book value / share8.218.14
Institutional Own % n/a n/a
Avg Daily Volume2831071.02928917.0

Valuation


BUY. The current P/E ratio indicates a premium compared to an average of 21.16 for the Multi-Utilities industry and a value on par with the S&P 500 average of 25.73. For additional comparison, its price-to-book ratio of 3.49 indicates a premium versus the S&P 500 average of 3.08 and a premium versus the industry average of 2.24. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. After reviewing these and other key valuation criteria, CENTERPOINT ENERGY INC proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
CNP 26.74 Peers 21.16   CNP 7.64 Peers 8.55

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

CNP is trading at a significant premium to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

CNP is trading at a discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
CNP 20.58 Peers 18.69   CNP 0.89 Peers 3.06

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

CNP is trading at a premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

CNP trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
CNP 3.49 Peers 2.24   CNP 169.03 Peers 23.21

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

CNP is trading at a significant premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

CNP is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
CNP 1.49 Peers 2.49   CNP 19.34 Peers 5.07

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

CNP is trading at a significant discount to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

CNP has a sales growth rate that significantly exceeds its peers.

 

 

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