Total SA Stock Hold Recommendation Reiterated (TOT)

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

NEW YORK ( TheStreet) -- Total (NYSE: TOT) has been reiterated by TheStreet Ratings as a hold with a ratings score of C+ . The company's strengths can be seen in multiple areas, such as its attractive valuation levels, largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year. 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:
  • TOT, with its decline in revenue, underperformed when compared the industry average of 0.6%. Since the same quarter one year prior, revenues fell by 11.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 56.9% when compared to the same quarter one year ago, falling from $4,093.13 million to $1,763.99 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, TOTAL SA's return on equity is significantly below that of the industry average and is below that of the S&P 500.

TOTAL S.A., together with its subsidiaries, operates as an integrated oil and gas company worldwide. The company operates in three segments: Upstream, Downstream, and Chemicals. The company has a P/E ratio of 7.2, below the average energy industry P/E ratio of 8.1 and below the S&P 500 P/E ratio of 17.7. Total has a market cap of $111.53 billion and is part of the basic materials sector and energy industry. Shares are down 3.7% year to date as of the close of trading on Thursday.

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

--Written by a member of TheStreet Ratings Staff.
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