Why Energy Transfer Equity (ETE) Stock Is Up Today

NEW YORK (TheStreet) -- Shares of Energy Transfer Equity  (ETE) are up 3.68% to $56.33 after its board approved building a crude oil pipeline to transport supply from strategic receipt points in the Bakken Three Forks production area in North Dakota to Patoka, Illinois.

The construction of the Bakken Pipeline project will help further develop the crude rich areas in and around the Bakken and provide additional crude supplies to U.S. markets and refineries along the East and Gulf Coasts.

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Separately, TheStreet Ratings team rates ENERGY TRANSFER EQUITY LP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate ENERGY TRANSFER EQUITY LP (ETE) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, compelling growth in net income, good cash flow from operations, notable return on equity 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 analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 3.2%. Since the same quarter one year prior, revenues rose by 17.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 86.7% when compared to the same quarter one year prior, rising from $90.00 million to $168.00 million.
  • Net operating cash flow has significantly increased by 151.21% to $829.00 million when compared to the same quarter last year. In addition, ENERGY TRANSFER EQUITY LP has also vastly surpassed the industry average cash flow growth rate of 17.51%.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, ENERGY TRANSFER EQUITY LP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • Powered by its strong earnings growth of 122.22% and other important driving factors, this stock has surged by 90.97% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • You can view the full analysis from the report here: ETE Ratings Report
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