Highlighted Post-Market Laggard: El Paso Pipeline Partners (EPB)

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 El Paso Pipeline Partners ( EPB) as a post-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified El Paso Pipeline Partners as such a stock due to the following factors:

  • EPB has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $66.2 million.
  • EPB is down 2.3% today from today's close.

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More details on EPB:

El Paso Pipeline Partners, L.P. owns and operates interstate natural gas transportation and terminaling facilities in the United States. The stock currently has a dividend yield of 6.4%. EPB has a PE ratio of 23.5. Currently there are no analysts that rate El Paso Pipeline Partners a buy, no analysts rate it a sell, and 10 rate it a hold.

The average volume for El Paso Pipeline Partners has been 1.5 million shares per day over the past 30 days. El Paso Pipeline has a market cap of $9.4 billion and is part of the basic materials sector and energy industry. The stock has a beta of 0.36 and a short float of 1.9% with 1.32 days to cover. Shares are up 11.8% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates El Paso Pipeline Partners as a buy. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, expanding profit margins and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.

Highlights from the ratings report include:
  • Net operating cash flow has slightly increased to $171.00 million or 4.26% when compared to the same quarter last year. In addition, EL PASO PIPELINE PARTNERS LP has also modestly surpassed the industry average cash flow growth rate of -5.22%.
  • The gross profit margin for EL PASO PIPELINE PARTNERS LP is currently very high, coming in at 76.77%. Regardless of EPB's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, EPB's net profit margin of 37.11% significantly outperformed against the industry.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 3.5%. Since the same quarter one year prior, revenues slightly dropped by 1.7%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • In its most recent trading session, EPB has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, EL PASO PIPELINE PARTNERS LP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

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