NEW YORK (TheStreet) -- Shares of Noble Energy (NBL) are up 2.76% to $71.40 after Atlantic Equities initiated coverage on the natural gas and exploration production company with an "overweight" rating and an $88 price target.
TheStreet Ratings team rates NOBLE ENERGY INC as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:
"We rate NOBLE ENERGY INC (NBL) a BUY. This is driven by a few notable strengths, 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, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 3.0%. Since the same quarter one year prior, revenues rose by 20.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Net operating cash flow has significantly increased by 53.61% to $828.00 million when compared to the same quarter last year. In addition, NOBLE ENERGY INC has also vastly surpassed the industry average cash flow growth rate of -5.01%.
- The current debt-to-equity ratio, 0.55, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.88 is somewhat weak and could be cause for future problems.
- The gross profit margin for NOBLE ENERGY INC is currently very high, coming in at 77.65%. Regardless of NBL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, NBL's net profit margin of 14.34% compares favorably to the industry average.
- NOBLE ENERGY INC's earnings per share declined by 47.5% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, NOBLE ENERGY INC reported lower earnings of $2.49 versus $2.67 in the prior year. This year, the market expects an improvement in earnings ($3.01 versus $2.49).
- You can view the full analysis from the report here: NBL Ratings Report
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