Rating Change #6

Eni SpA ( E) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its attractive valuation levels and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:
  • The current debt-to-equity ratio, 0.56, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.72 is somewhat weak and could be cause for future problems.
  • The gross profit margin for ENI SPA is rather low; currently it is at 24.50%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 6.70% trails that of the industry average.
  • Net operating cash flow has decreased to $2,585.64 million or 42.20% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

Eni SpA, an integrated energy company, engages in the exploration, production, transportation, transformation, and marketing of oil and natural gas. The company has a P/E ratio of 4.2, below the average energy industry P/E ratio of 12.3 and below the S&P 500 P/E ratio of 17.7. Eni SpA has a market cap of $75.02 billion and is part of the basic materials sector and energy industry. Shares are up 0.9% year to date as of the close of trading on Tuesday.

You can view the full Eni SpA Ratings Report or get investment ideas from our investment research center.

If you liked this article you might like

With Eyes on Solar Eclipse, Wall Street Stumbles Yet Again

5 Solid Picks Among International Stocks