Enbridge Energy Partners LP Stock Downgraded (EEP)

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NEW YORK ( TheStreet) -- Enbridge Energy Partners (NYSE: EEP) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its revenue growth and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, disappointing return on equity and poor profit margins.

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Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 10.2%. Since the same quarter one year prior, revenues slightly increased by 7.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has significantly increased by 174.34% to $271.60 million when compared to the same quarter last year. In addition, ENBRIDGE ENERGY PRTNRS -LP has also vastly surpassed the industry average cash flow growth rate of -17.88%.
  • The gross profit margin for ENBRIDGE ENERGY PRTNRS -LP is currently lower than what is desirable, coming in at 31.57%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 6.29% trails that of the industry average.
  • ENBRIDGE ENERGY PRTNRS -LP's earnings per share declined by 45.5% in the most recent quarter compared to the same quarter a year ago. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, ENBRIDGE ENERGY PRTNRS -LP reported lower earnings of $1.25 versus $1.89 in the prior year. For the next year, the market is expecting a contraction of 32.8% in earnings ($0.84 versus $1.25).

Enbridge Energy Partners, L.P. owns and operates crude oil and liquid petroleum transportation and storage assets; and natural gas gathering, treating, processing, transportation, and marketing assets in the United States. Enbridge Energy has a market cap of $7.44 billion and is part of the basic materials sector and energy industry. Shares are up 4.7% year to date as of the close of trading on Thursday.

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

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