Spectra Energy Corp Stock Buy Recommendation Reiterated (SE)

NEW YORK ( TheStreet) -- Spectra Energy (NYSE: SE) has been reiterated by TheStreet Ratings as a buy with a ratings score of B+. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income, good cash flow from operations, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 10.7%. Since the same quarter one year prior, revenues slightly increased by 2.9%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry average. The net income increased by 2.1% when compared to the same quarter one year prior, going from $333.00 million to $340.00 million.
  • Net operating cash flow has slightly increased to $582.00 million or 6.59% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -25.63%.
  • 43.55% is the gross profit margin for SPECTRA ENERGY CORP which we consider to be strong. Regardless of SE's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SE's net profit margin of 21.39% significantly outperformed against the industry.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.

Spectra Energy Corp, through its subsidiaries, owns and operates a portfolio of natural gas-related energy assets in North America. The company's U.S. Spectra Energy has a market cap of $23.3 billion and is part of the basic materials sector and energy industry. Shares are up 29.4% year to date as of the close of trading on Monday.

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

--Written by a member of TheStreet Ratings Staff.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
null

If you liked this article you might like

After Soaring to $150, Can Incyte Stir Up More Upside?

Biotech Movers: Cempra Flys High On Phase Three Results

Kinder Morgan Was the Biggest Energy Beneficiary From the 'Trump Rally'

Cramer: The 10 Biggest Gainers of 2016, and How They Will Fare in 2017

3 Stocks That Will Perform Well Under a Trump Presidency