3 Stocks Pushing The Utilities Sector Lower

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The Utilities sector as a whole closed the day down 1.8% versus the S&P 500, which was down 1.3%. Laggards within the Utilities sector included Pure Cycle ( PCYO), down 4.6%, Gas Natural ( EGAS), down 2.3%, Artesian Resource ( ARTNA), down 2.0%, Centrais Eletricas Brasileiras ( EBR.B), down 9.8% and York Water ( YORW), down 2.5%.

TheStreet Ratings Group would like to highlight 3 stocks that pushed the sector lower today:

Artesian Resource ( ARTNA) is one of the companies that pushed the Utilities sector lower today. Artesian Resource was down $0.45 (2.0%) to $22.15 on average volume. Throughout the day, 18,894 shares of Artesian Resource exchanged hands as compared to its average daily volume of 19,300 shares. The stock ranged in price between $22.06-$22.66 after having opened the day at $22.49 as compared to the previous trading day's close of $22.60.

Artesian Resources Corporation, through its subsidiaries, provides water, wastewater, and other services on the Delmarva Peninsula. It distributes and sells water to residential, commercial, industrial, municipal, and utility customers in the states of Delaware, Maryland, and Pennsylvania. Artesian Resource has a market cap of $178.8 million and is part of the utilities industry. Shares are up 0.0% year-to-date as of the close of trading on Thursday. Currently there is 1 analyst who rates Artesian Resource a buy, 1 analyst rates it a sell, and 1 rates it a hold.

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TheStreet Ratings rates Artesian Resource as a buy. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, good cash flow from operations, expanding profit margins and growth in earnings per share. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from TheStreet Ratings analysis on ARTNA go as follows:

  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Water Utilities industry average. The net income increased by 27.4% when compared to the same quarter one year prior, rising from $2.60 million to $3.32 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 8.5%. Since the same quarter one year prior, revenues slightly increased by 8.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Net operating cash flow has increased to $6.94 million or 21.44% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -3.12%.
  • The gross profit margin for ARTESIAN RESOURCES is rather high; currently it is at 50.07%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 16.92% trails the industry average.
  • ARTESIAN RESOURCES has improved earnings per share by 27.6% 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, ARTESIAN RESOURCES reported lower earnings of $0.93 versus $1.14 in the prior year. This year, the market expects an improvement in earnings ($1.04 versus $0.93).

You can view the full analysis from the report here: Artesian Resource Ratings Report

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At the close, Gas Natural ( EGAS) was down $0.23 (2.3%) to $9.75 on average volume. Throughout the day, 48,811 shares of Gas Natural exchanged hands as compared to its average daily volume of 32,600 shares. The stock ranged in price between $9.59-$10.00 after having opened the day at $10.00 as compared to the previous trading day's close of $9.98.

Gas Natural Inc. is engaged in the distribution and sale of natural gas to residential, commercial, and industrial customers. It operates through Natural Gas Operations, Marketing and Production Operations, and Pipeline Operations segments. Gas Natural has a market cap of $101.2 million and is part of the utilities industry. Shares are down 9.4% year-to-date as of the close of trading on Thursday. Currently there is 1 analyst who rates Gas Natural a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Gas Natural as a hold. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income and feeble growth in the company's earnings per share.

Highlights from TheStreet Ratings analysis on EGAS go as follows:

  • Net operating cash flow has significantly increased by 107.03% to $0.19 million when compared to the same quarter last year. In addition, GAS NATURAL INC has also vastly surpassed the industry average cash flow growth rate of -43.11%.
  • The debt-to-equity ratio is somewhat low, currently at 0.71, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.16 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • EGAS, with its decline in revenue, slightly underperformed the industry average of 7.9%. Since the same quarter one year prior, revenues slightly dropped by 0.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • GAS NATURAL INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, GAS NATURAL INC increased its bottom line by earning $0.71 versus $0.48 in the prior year. For the next year, the market is expecting a contraction of 4.2% in earnings ($0.68 versus $0.71).
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Gas Utilities industry. The net income has significantly decreased by 47.3% when compared to the same quarter one year ago, falling from -$1.01 million to -$1.48 million.

You can view the full analysis from the report here: Gas Natural Ratings Report

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Pure Cycle ( PCYO) was another company that pushed the Utilities sector lower today. Pure Cycle was down $0.20 (4.6%) to $4.18 on heavy volume. Throughout the day, 739,317 shares of Pure Cycle exchanged hands as compared to its average daily volume of 59,100 shares. The stock ranged in price between $4.12-$4.32 after having opened the day at $4.32 as compared to the previous trading day's close of $4.38.

Pure Cycle Corporation designs, constructs, operates, and maintains water and wastewater systems in the Denver metropolitan area, the United States. Pure Cycle has a market cap of $108.2 million and is part of the utilities industry. Shares are up 9.5% year-to-date as of the close of trading on Thursday. Currently there is 1 analyst who rates Pure Cycle a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Pure Cycle as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and weak operating cash flow.

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Highlights from TheStreet Ratings analysis on PCYO go as follows:

  • The revenue growth greatly exceeded the industry average of 8.4%. Since the same quarter one year prior, revenues rose by 44.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • PCYO's debt-to-equity ratio is very low at 0.06 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.28, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for PURE CYCLE CORP is currently very high, coming in at 78.54%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, PCYO's net profit margin of 1.19% significantly trails the industry average.
  • Net operating cash flow has significantly decreased to -$0.28 million or 129.75% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • PCYO's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 26.36%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.

You can view the full analysis from the report here: Pure Cycle Ratings Report

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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