NEW YORK (TheStreet) -- Dominion Resources (D) shares are up 0.9% to $72.53 in early market trading on Thursday after the energy company was added to Citigroup's "focus list" before the opening bell today.
Analysts at the firm believe that the company's stock is currently undervalued due to what it sees as very promising opportunities for positive cash flow in the near term.
Analysts at Wells Fargo initiated coverage on the company's stock yesterday with a "market perform" rating. Dominion Resources has an average rating of "hold" from 13 ratings agencies with an average twelve month price target of $74.78.
TheStreet Ratings team rates DOMINION RESOURCES INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate DOMINION RESOURCES INC (D) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its expanding profit margins and increase in stock price during the past year. 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 analysis by TheStreet Ratings Team goes as follows:
- 43.21% is the gross profit margin for DOMINION RESOURCES INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 17.34% is above that of the industry average.
- DOMINION RESOURCES INC's earnings per share declined by 11.8% 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, DOMINION RESOURCES INC increased its bottom line by earning $3.09 versus $2.49 in the prior year. This year, the market expects an improvement in earnings ($3.45 versus $3.09).
- D, with its decline in revenue, slightly underperformed the industry average of 1.7%. Since the same quarter one year prior, revenues fell by 11.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
- The change in net income from the same quarter one year ago has exceeded that of the Multi-Utilities industry average, but is less than that of the S&P 500. The net income has decreased by 7.0% when compared to the same quarter one year ago, dropping from $569.00 million to $529.00 million.
- You can view the full analysis from the report here: D Ratings Report