Strong And Under The Radar Today: Energy Transfer Equity (ETE)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Energy Transfer Equity ( ETE) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Energy Transfer Equity as such a stock due to the following factors:

  • ETE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $48.4 million.
  • ETE is making at least a new 3-day high.
  • ETE has a PE ratio of 104.5.
  • ETE is mentioned 1.52 times per day on StockTwits.
  • ETE has not yet been mentioned on StockTwits today.
  • ETE is currently in the upper 20% of its 1-year range.
  • ETE is in the upper 35% of its 20-day range.
  • ETE is in the upper 45% of its 5-day range.
  • ETE is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

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More details on ETE:

Energy Transfer Equity, L.P., through its subsidiaries, provides diversified energy-related services in the Unites States. The company sells natural gas to electric utilities, independent power plants, local distribution companies, industrial end-users, and other marketing companies. The stock currently has a dividend yield of 2.6%. ETE has a PE ratio of 104.5. Currently there are 7 analysts that rate Energy Transfer Equity a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Energy Transfer Equity has been 1.3 million shares per day over the past 30 days. Energy Transfer Equity has a market cap of $31.5 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.27 and a short float of 1.2% with 9.78 days to cover. Shares are up 45% year-to-date as of the close of trading on Tuesday.

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

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Energy Transfer Equity as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity, good cash flow from operations, increase in net income 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 2.4%. Since the same quarter one year prior, revenues rose by 17.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, ENERGY TRANSFER EQUITY LP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Oil, Gas & Consumable Fuels industry average. The net income increased by 29.1% when compared to the same quarter one year prior, rising from $127.00 million to $164.00 million.
  • Net operating cash flow has increased to $1,066.00 million or 33.75% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -6.15%.
  • Powered by its strong earnings growth of 31.81% and other important driving factors, this stock has surged by 79.18% 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.

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

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