NEW YORK (TheStreet) -- Shares of Enbridge Inc. (ENB) opened slightly higher today after a federal judge ruled that the company's pipeline to carry tar sands oil between Oklahoma and Illinois can proceed, as companies expand their capacity to move petroleum in the U.S., Bloomberg reports.
"Because a private company is constructing the 589-mile pipeline on mostly privately owned land that is entirely within the territorial borders of the U.S., no federal statute authorizes the federal government to oversee or regulate the construction project," U.S. District Judge Ketanji Brown Jackson in Washington said in a written ruling.
The judge rejected arguments by the Sierra Club and the National Wildlife Federation that the failure to conduct an environmental impact review of the pipeline violated the National Environmental Protection Act, Bloomberg said.
TheStreet Ratings team rates ENBRIDGE INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate ENBRIDGE INC (ENB) a BUY. This is driven by several positive factors, 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, solid stock price performance, impressive record of earnings per share growth and notable return on equity. 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 greatly exceeded the industry average of 2.6%. Since the same quarter one year prior, revenues rose by 29.7%. 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 858.8% when compared to the same quarter one year prior, rising from $85.00 million to $815.00 million.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
- ENBRIDGE INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, ENBRIDGE INC reported lower earnings of $0.55 versus $0.87 in the prior year.
- 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. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, ENBRIDGE INC'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: ENB Ratings Report