Why Boardwalk Pipeline Partners (BWP) Plummeted to a One-Year Low Today (Update)

Update (5:30 p.m.): Updated with closing price, one-year low price and volume.

NEW YORK (TheStreet) -- Boardwalk Pipeline Partners  (BWP) shares plummeted 45.99% to $13.01, an $11.08 decline from its previous close of $24.09, at the close of the trading day on Monday after the energy company reported a 78% decrease in net income attributable to controlling interests in its fourth-quarter report.

The stock plunged to a one-year low of $12.79 on Monday and had a volume of 43,104,169, more than 65 times its average of 655,777.

The company noted a drop to $19.5 million to from $90.1 million in the same quarter one year earlier. Net income per unit also declined to eight cents a share from 38 cents a share in the same period one year earlier. Boardwalk also announced that it had cut its quarterly cash distribution by more than 80% to 10 cents a share.

Credit Suisse downgraded Boardwalk Pipeline to "underperform" from "neutral," lowering its target price to $20.

Must Read: Trade-Ideas: Boardwalk Pipeline Partners (BWP) Is Today's Pre-Market Mover With Heavy Volume Stock

TheStreet Ratings team rates BOARDWALK PIPELINE PRTNRS-LP as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

"We rate BOARDWALK PIPELINE PRTNRS-LP (BWP) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • BWP's revenue growth has slightly outpaced the industry average of 1.9%. Since the same quarter one year prior, revenues slightly increased by 1.8%. 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.
  • BWP's debt-to-equity ratio of 0.81 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.72 is weak.
  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, BWP has underperformed the S&P 500 Index, declining 12.99% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
  • 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, BOARDWALK PIPELINE PRTNRS-LP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • You can view the full analysis from the report here: BWP Ratings Report

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