EQT Midstream Partners LP Stock Upgraded (EQM)

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.

NEW YORK ( TheStreet) -- EQT Midstream Partners (NYSE: EQM) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, growth in earnings per share, compelling growth in net income, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

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Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 4.1%. Since the same quarter one year prior, revenues rose by 21.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • EQT MIDSTREAM PARTNERS LP has improved earnings per share by 37.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, EQT MIDSTREAM PARTNERS LP increased its bottom line by earning $2.49 versus $2.40 in the prior year. This year, the market expects an improvement in earnings ($3.45 versus $2.49).
  • 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 28.1% when compared to the same quarter one year prior, rising from $40.66 million to $52.08 million.
  • Net operating cash flow has significantly increased by 179.90% to $72.96 million when compared to the same quarter last year. In addition, EQT MIDSTREAM PARTNERS LP has also vastly surpassed the industry average cash flow growth rate of -5.79%.
  • The gross profit margin for EQT MIDSTREAM PARTNERS LP is currently very high, coming in at 76.52%. Regardless of EQM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, EQM's net profit margin of 56.87% significantly outperformed against the industry.
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EQT Midstream Partners, LP provides natural gas transmission, storage, and gathering services in southwestern Pennsylvania and northern West Virginia. It owns, operates, acquires, and develops midstream assets in the Appalachian Basin. EQT Midstream has a market cap of $4.05 billion and is part of the basic materials sector and energy industry. Shares are up 61.5% year to date as of the close of trading on Wednesday.

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