PPL Corp (PPL): Today's Featured Utilities Laggard

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.

PPL ( PPL) pushed the Utilities sector lower today making it today's featured Utilities laggard. The sector as a whole closed the day down 0.7%. By the end of trading, PPL fell 32 cents (-1.1%) to $30.17 on light volume. Throughout the day, 2.6 million shares of PPL exchanged hands as compared to its average daily volume of four million shares. The stock ranged in price between $30.14-$30.36 after having opened the day at $30.34 as compared to the previous trading day's close of $30.49. Other companies within the Utilities sector that declined today were: Empresa Distribuidora y Comercializadora No ( EDN), down 8%, Transportadora de Gas del Sur ( TGS), down 4.6%, Just Energy Group ( JE), down 4.5%, and U.S. Geothermal ( HTM), down 3.6%.
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PPL Corporation, an energy and utility holding company, engages in the generation, transmission, distribution, and sale of electricity to wholesale and retail customers in the United States and the United Kingdom. The company operates in four segments: Kentucky Regulated, U.K. PPL has a market cap of $17.61 billion and is part of the utilities industry. The company has a P/E ratio of 11.6, below the S&P 500 P/E ratio of 17.7. Shares are up 6.5% year to date as of the close of trading on Friday. Currently there are three analysts that rate PPL a buy, no analysts rate it a sell, and seven rate it a hold.

TheStreet Ratings rates PPL as a buy. The company's strengths can be seen in multiple areas, such as its notable return on equity, good cash flow from operations and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the utilities sector could consider Utilities Select Sector SPDR ( XLU) while those bearish on the utilities sector could consider ProShares UltraShort Utilities ( SDP).

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