EnLink Midstream Partners (ENLK) Stock Is Down Today After Pricing Public Offering

NEW YORK (TheStreet) -- Shares of EnLink Midstream Partners (ENLK) were falling 6.2% to $27.60 after the oil and gas company announced pricing of its public offering of 10.5 million common units.

EnLink priced the 10.5 million common units in the offering at $28.37 a common unit. The company gave the underwriters of the offering a 30-day option to buy an additional 1.575 million additional common units.

Enlicnk Midstream Partners said it plans to use the net proceeds from the offering, including any net proceeds from the underwriters' exercise of their option, for capital expenditures and general partnership purposes.

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TheStreet Ratings team rates ENLINK MIDSTREAM PARTNERS LP as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:

"We rate ENLINK MIDSTREAM PARTNERS LP (ENLK) a BUY. This is driven by a number of 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, impressive record of earnings per share growth, compelling growth in net income and solid stock price performance. We feel these strengths outweigh the fact that the company shows low profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • ENLK's very impressive revenue growth greatly exceeded the industry average of 6.7%. Since the same quarter one year prior, revenues leaped by 81.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • ENLINK MIDSTREAM PARTNERS LP reported significant earnings per share improvement 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, ENLINK MIDSTREAM PARTNERS LP continued to lose money by earning -$0.97 versus -$1.01 in the prior year. This year, the market expects an improvement in earnings ($0.54 versus -$0.97).
  • 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 155.8% when compared to the same quarter one year prior, rising from -$78.84 million to $44.00 million.
  • 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.
  • The gross profit margin for ENLINK MIDSTREAM PARTNERS LP is rather low; currently it is at 20.95%. Regardless of ENLK's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 5.16% trails the industry average.
  • You can view the full analysis from the report here: ENLK Ratings Report

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