CenterPoint Energy Inc

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CNP : NYSE : Utilities
$28.96 up 0.12 | 0.42%
Today's Range: 28.77 - 28.985
Avg. Daily Volume: 2769600.0
08/16/17 - 3:59 PM ET

Financial Analysis


CENTERPOINT ENERGY INC's gross profit margin for the second quarter of its fiscal year 2017 has significantly decreased when compared to the same period a year ago. The company grew its sales and net income significantly quarter versus same quarter a year prior, and was able to outpace the average competitor in the industry when comparing revenue growth, but not when comparing net income growth. CENTERPOINT ENERGY INC has weak liquidity. Currently, the Quick Ratio is 0.67 which shows a lack of ability to cover short-term cash needs. The liquidity decreased from the same period a year ago, despite already having weak liquidity to begin with. This would indicate deteriorating cash flow.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 4.88% 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 Q2 FY17 Q2 FY16
Net Sales ($mil)2143.01574.0
EBITDA ($mil)477.0471.0
EBIT ($mil)223.0182.0
Net Income ($mil)135.0-2.0


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)1268.01008.0
Total Assets ($mil)22045.021012.0
Total Debt ($mil)8701.08560.0
Equity ($mil)3563.03397.0


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin22.2629.92
EBITDA Margin22.2529.92
Operating Margin10.4111.56
Sales Turnover0.40.33
Return on Assets2.75-3.55
Return on Equity17.03-22.01
Debt Q2 FY17 Q2 FY16
Current Ratio0.941.01
Debt/Capital0.710.72
Interest Expense99.0110.0
Interest Coverage2.251.65


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)431.02430.68
Div / share0.270.26
EPS0.31-0.01
Book value / share8.277.89
Institutional Own % n/a n/a
Avg Daily Volume2854417.02923884.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 21.38 for the Multi-Utilities industry and a discount compared to the S&P 500 average of 24.31. For additional comparison, its price-to-book ratio of 3.52 indicates a premium versus the S&P 500 average of 3.03 and a premium versus the industry average of 2.21. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. The valuation analysis reveals that, CENTERPOINT ENERGY INC seems to be trading at a discount 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 20.96 Peers 21.38   CNP 8.10 Peers 8.19

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

CNP is trading at a valuation on par with its peers.

 

Average. 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 valuation on par 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 20.66 Peers 18.53   CNP 0.64 Peers 3.64

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 3.52 Peers 2.21   CNP 179.88 Peers 30.00

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 1.42 Peers 2.41   CNP 26.78 Peers 7.50

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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