Energy Transfer Partners (ETP) Marked As A Barbarian At The Gate

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 Partners ( ETP) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified Energy Transfer Partners as such a stock due to the following factors:

  • ETP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $102.2 million.
  • ETP has traded 780,554 shares today.
  • ETP traded in a range 203.4% of the normal price range with a price range of $2.10.
  • ETP traded above its daily resistance level (quality: 6 days, meaning that the stock is crossing a resistance level set by the last 6 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on ETP:

Energy Transfer Partners, L.P. is engaged in the natural gas midstream, and intrastate transportation and storage businesses in the United States. The stock currently has a dividend yield of 6.3%. ETP has a PE ratio of 301.8. Currently there are 8 analysts that rate Energy Transfer Partners a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Energy Transfer Partners has been 1.4 million shares per day over the past 30 days. Energy Transfer has a market cap of $19.6 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.01 and a short float of 3.3% with 3.28 days to cover. Shares are up 3.9% year-to-date as of the close of trading on Thursday.

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 Partners as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations, increase in net income, solid stock price performance and growth in earnings per share. 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 3.1%. Since the same quarter one year prior, revenues rose by 12.8%. 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 47.2% when compared to the same quarter one year prior, rising from $320.00 million to $471.00 million.
  • Net operating cash flow has slightly increased to $891.00 million or 9.86% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -5.24%.
  • 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. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • ENERGY TRANSFER PARTNERS -LP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ENERGY TRANSFER PARTNERS -LP swung to a loss, reporting -$0.24 versus $5.76 in the prior year. This year, the market expects an improvement in earnings ($2.92 versus -$0.24).

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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