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Biggest Utilities Sector Movers for July 3, 2012
The market is currently up, with the Nasdaq up 0.7%, the S&P 500 increasing 0.7% and the Dow moving up 0.6%. The utilities sector is a category of stocks for utilities such as gas and power. It contains companies such as electric, gas and water firms and integrated providers. Because utilities require significant infrastructure, these firms often carry large amounts of debt. With a high debt load, utilities companies become sensitive to changes in the interest rate. As interest rates rise or drop, the debt payments will increase or decrease. The utilities sector performs best when interest rates are falling or remain low.
The Utilities sector (XLU) is down 0.2% on a good day for the market overall. The biggest movers in the sector so far are:
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CPFL Energia S.A (NYSE:CPL) is down 4.3% to reach $24.61 per share. The company's volume for the day so far is 298,805 shares. This is below yesterday's volume of 631,357 shares. Volume is an important indicator in technical analysis as it is used to measure the worth of a market move. If the markets have made strong price move either up or down the perceived strength of that move depends on the volume for that period. The higher the volume during that price move the more significant the move. Profit-margin ratios help us to keep score, as measured over time, of management's ability to generate profits and manage costs and expenses. There are three key profit-margin ratios: gross profit margin, operating profit margin and net profit margin. CPL's gross profit margin is 36.2%. Net profit margin is a good ratio for determining how a company is performing. The company has a net profit margin of 11.2%.
A wide array of ratios can be used by investors to estimate the attractiveness of a potential or existing investment and get an idea of its valuation. A company's price/earnings ratio (P/E ratio) provides a measure of how expensive or cheap a stock is. CPL's P/E ratio of 12.8 is under the industry average of 14.49. A low P/E might arise due to substantial inherent risk of the firm and its operations, poor return on equity, or improper valuation of the market. A high P/E ratio indicates a stock that is expensive, while a low P/E ratio indicates a stock that is cheap. SEE: Understanding The P/E Ratio
Atlas (NYSE:ATLS) is up 2.9% to reach a current price of $31.76 per share. The company's volume for the day so far is 36,170 shares. Volume indicates the level of interest that investors have in a company at its current price. There are many tools investors can use to evaluate a stock, including margins. Margins, quite simply, are earnings expressed as a ratio, or a percentage of sales, and this allows investors to compare the profitability of different companies, while net earnings, which are presented as an absolute number, cannot. ATLS has a low gross profit margin of 20%. Investors should track gross profit margin ratios over several years in order to see if earnings are consistent, growing or declining. Relative to its gross profit margin, ATLS' operating profit margin of 0.3% and net profit margin of 3.1% are low.
When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. The price/book value ratio provides a way of evaluating whether a stock is relatively cheap or expensive. ATLS' P/B ratio of 3.43 shows that its share price is higher than its book value. This high share price relative to asset value is likely to indicate that the company has been earning a very high return on its assets. All else being equal, a stock with a low P/B value ratio is more attractive than a stock with a high ratio. SEE: Using The Price-To-Book Ratio To Evaluate Companies
TransAlta Corporation (NYSE:TAC) has risen 2.5% to hit a current price of $17.37 per share. The company's volume for the day so far is 34,982 share, 0.7 times the average volume over the last three months. The trading volume for a stock indicates the level of investor interest. Margin analysis tells us how effectively management can wring profits from sales and how much room a company has to withstand a downturn, fend off competition and make mistakes. TAC's gross profit margin is 42.6%. Net profit margin is calculated by dividing net income by sales. Net profit margin for the company is 7.8%.
Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. The dividend yield is calculated by dividing a company's dividends per share by its stock price. TAC has a dividend yield of 7%. Just as with the yield on a bond or certificate of deposit, the higher the dividend yield, the higher the return to the investor. SEE: Guide To Stock-Picking Strategies: Income Investing
At $29.40, Huaneng Power International, Inc (NYSE:HNP) has slipped 1.9%. The company's volume for the day so far is 21,036 shares. This is 0.1 times its current daily average. A stock's volume conveys how excited investors are about it. Margin ratios highlight companies that are worth further examination. The gross profit margin for HNP is 34.6%. A company's operating margin is calculated by dividing operating income by revenues. HNP's operating profit margin is 4.6%. Tracking net profit margin over time for a single company can be a valuable tool for seeing how a business is developing. Net margin is 0.9%.
In making a decision about a potential or existing investment, valuation ratios are useful as a basis for seeing whether the stock price is too high, reasonable, or a bargain. The price/sales ratio measures a company's stock market price by its revenues. HNP has a low P/S ratio of 0.46. A company with a lower P/S ratio is generally considered more attractive, since investors are paying less for each dollar of sales. A limitation of the P/S ratio is that the price component measures only stock market captialization, while sales are a function of the entire capital structure, potentially leading to wide differences between levered and unlevered companies.
National Fuel (NYSE:NFG) has risen 1.8% and is currently trading at $47.79 per share. So far today, the company's volume is 154,924 shares, while it was 559,163 shares yesterday. High volume indicates a lot of investor interest while low volume indicates the opposite. Profit-margin ratios measure how much money a company squeezes from its total revenue or total sales. Investors can look at a company's gross profit margin, operating profit margin and net margin to understand a company's profitability. NFG's gross profit margin is 45.3%. Net profit margin is calculated by dividing net income by sales; the higher the net profit margin, the better. The company has a net profit margin of 12.9%.
Investment valuation ratios can be very useful in estimating whether a stock price is too high, reasonable or a bargain investment opportunity. The easy-to-calculate debt ratio is helpful to investors looking for a quick take on the leverage for a company. NFG has a debt ratio of 66.3%, which is on the high side. This means that most of the company's assets are financed through debt. However, one thing to note with this ratio: it isn't a pure measure of a company's debt (or indebtedness), as it also includes operational liabilities, such as accounts payable and taxes payable.
Targa (NYSE:TRGP) has moved up 1.6% and is currently trading at $42.89 per share. The company is currently trading a volume of 201,503 shares. Price change alone is not enough to know how a stock is doing. Volume is an important secondary indicator used to confirm trends suggested by price movement. Profit-margin ratios help us to keep score, as measured over time, of management's ability to generate profits and manage costs and expenses. There are three key profit-margin ratios: gross profit margin, operating profit margin and net profit margin. TRGP has a low gross profit margin of 10.1%. This may mean that the company is struggling to control production costs, or that a low amount of earnings is being generated from revenues. While ratios such as price/earnings (P/E) or price/book value look at the relative attractiveness of a stock, the net profit margin ratio focuses on company performance rather that stock market valuation. The company's net margin is 0.5%, which is low compared to its gross margin. A low profit margin may indicate a pricing strategy.
Investment valuation ratios can be very useful in determining the value of a stock, but it is very important to keep in mind that while some financial ratios have general rules (or a broad application), in most instances it is a prudent practice to look at a company's historical performance and use peer company/industry comparisons to put any given company's ratio in perspective. The debt-equity (D/E) ratio is a leverage ratio. TRGP has a high D/E ratio of 1048%. Generally, a high D/E ratio means that the company may have difficulty generating enough cash to pay off its debts. The D/E ratio is not a pure measurement of a company's debt because it includes operational liabilities in total liabilities.
After an increase of 1.6%, TransCanada Corporation (NYSE:TRP) has reached a current price of $42.44. With 217,128 shares changing hands so far today, the company's volume is 0.6 times its average over the past three months. Volume is an important indicator because it indicates how significant a price shift is. Margin analysis is a great way to understand the profitability of companies. TRP's gross profit margin is 61.1%. Ideally, a company's profit margin should be stable or rising; declining profit margin should be cause for concern or further investigation. The company's net profit margin is 17.1%.
Valuation ratios like the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield are useful in determining how attractive a potential or existing investment is. The capitalization ratio measures the debt component of the capital structure, or capitalization of a company (i.e., the sum of long-term debt liabilities and shareholder equity) to support operations and growth. TRP has a high capitalization ratio of 53%. A company considered too highly leveraged (too much debt) may find its freedom of action restricted by its creditors and/or have its profitability hurt by high interest costs. This ratio is considered to be one of the more meaningful of the "debt" ratios - it delivers the key insight into the use of leverage by a company.
The Bottom Line No matter the economic climate, Wall Street will always have stocks that make major moves each week. Paying close attention to the previous ratios will help you identify key times to adjust your strategy. However, these fundamental metrics must be analyzed with historic data, industry information in addition to firm specific financial statements.
The Utilities sector (XLU) is down 0.2% on a good day for the market overall. The biggest movers in the sector so far are:
| Company | Market Cap | Percentage Change |
| CPFL Energia S.A. (ADR) (NYSE:CPL) | $12.37 billion | -4.3% |
| Atlas Energy LP (NYSE:ATLS) | $1.58 billion | +2.9% |
| TransAlta Corporation (USA) (NYSE:TAC) | $3.85 billion | +2.5% |
| Huaneng Power International, Inc. (ADR) (NYSE:HNP) | $10.53 billion | -1.9% |
| National Fuel Gas Co. (NYSE:NFG) | $3.91 billion | +1.8% |
| Targa Resources Corp (NYSE:TRGP) | $1.79 billion | +1.6% |
| TransCanada Corporation (USA) (NYSE:TRP) | $29.44 billion | +1.6% |
CPFL Energia S.A (NYSE:CPL) is down 4.3% to reach $24.61 per share. The company's volume for the day so far is 298,805 shares. This is below yesterday's volume of 631,357 shares. Volume is an important indicator in technical analysis as it is used to measure the worth of a market move. If the markets have made strong price move either up or down the perceived strength of that move depends on the volume for that period. The higher the volume during that price move the more significant the move. Profit-margin ratios help us to keep score, as measured over time, of management's ability to generate profits and manage costs and expenses. There are three key profit-margin ratios: gross profit margin, operating profit margin and net profit margin. CPL's gross profit margin is 36.2%. Net profit margin is a good ratio for determining how a company is performing. The company has a net profit margin of 11.2%.
A wide array of ratios can be used by investors to estimate the attractiveness of a potential or existing investment and get an idea of its valuation. A company's price/earnings ratio (P/E ratio) provides a measure of how expensive or cheap a stock is. CPL's P/E ratio of 12.8 is under the industry average of 14.49. A low P/E might arise due to substantial inherent risk of the firm and its operations, poor return on equity, or improper valuation of the market. A high P/E ratio indicates a stock that is expensive, while a low P/E ratio indicates a stock that is cheap. SEE: Understanding The P/E Ratio
Atlas (NYSE:ATLS) is up 2.9% to reach a current price of $31.76 per share. The company's volume for the day so far is 36,170 shares. Volume indicates the level of interest that investors have in a company at its current price. There are many tools investors can use to evaluate a stock, including margins. Margins, quite simply, are earnings expressed as a ratio, or a percentage of sales, and this allows investors to compare the profitability of different companies, while net earnings, which are presented as an absolute number, cannot. ATLS has a low gross profit margin of 20%. Investors should track gross profit margin ratios over several years in order to see if earnings are consistent, growing or declining. Relative to its gross profit margin, ATLS' operating profit margin of 0.3% and net profit margin of 3.1% are low.
When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. The price/book value ratio provides a way of evaluating whether a stock is relatively cheap or expensive. ATLS' P/B ratio of 3.43 shows that its share price is higher than its book value. This high share price relative to asset value is likely to indicate that the company has been earning a very high return on its assets. All else being equal, a stock with a low P/B value ratio is more attractive than a stock with a high ratio. SEE: Using The Price-To-Book Ratio To Evaluate Companies
TransAlta Corporation (NYSE:TAC) has risen 2.5% to hit a current price of $17.37 per share. The company's volume for the day so far is 34,982 share, 0.7 times the average volume over the last three months. The trading volume for a stock indicates the level of investor interest. Margin analysis tells us how effectively management can wring profits from sales and how much room a company has to withstand a downturn, fend off competition and make mistakes. TAC's gross profit margin is 42.6%. Net profit margin is calculated by dividing net income by sales. Net profit margin for the company is 7.8%.
Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. The dividend yield is calculated by dividing a company's dividends per share by its stock price. TAC has a dividend yield of 7%. Just as with the yield on a bond or certificate of deposit, the higher the dividend yield, the higher the return to the investor. SEE: Guide To Stock-Picking Strategies: Income Investing
At $29.40, Huaneng Power International, Inc (NYSE:HNP) has slipped 1.9%. The company's volume for the day so far is 21,036 shares. This is 0.1 times its current daily average. A stock's volume conveys how excited investors are about it. Margin ratios highlight companies that are worth further examination. The gross profit margin for HNP is 34.6%. A company's operating margin is calculated by dividing operating income by revenues. HNP's operating profit margin is 4.6%. Tracking net profit margin over time for a single company can be a valuable tool for seeing how a business is developing. Net margin is 0.9%.
In making a decision about a potential or existing investment, valuation ratios are useful as a basis for seeing whether the stock price is too high, reasonable, or a bargain. The price/sales ratio measures a company's stock market price by its revenues. HNP has a low P/S ratio of 0.46. A company with a lower P/S ratio is generally considered more attractive, since investors are paying less for each dollar of sales. A limitation of the P/S ratio is that the price component measures only stock market captialization, while sales are a function of the entire capital structure, potentially leading to wide differences between levered and unlevered companies.
National Fuel (NYSE:NFG) has risen 1.8% and is currently trading at $47.79 per share. So far today, the company's volume is 154,924 shares, while it was 559,163 shares yesterday. High volume indicates a lot of investor interest while low volume indicates the opposite. Profit-margin ratios measure how much money a company squeezes from its total revenue or total sales. Investors can look at a company's gross profit margin, operating profit margin and net margin to understand a company's profitability. NFG's gross profit margin is 45.3%. Net profit margin is calculated by dividing net income by sales; the higher the net profit margin, the better. The company has a net profit margin of 12.9%.
Investment valuation ratios can be very useful in estimating whether a stock price is too high, reasonable or a bargain investment opportunity. The easy-to-calculate debt ratio is helpful to investors looking for a quick take on the leverage for a company. NFG has a debt ratio of 66.3%, which is on the high side. This means that most of the company's assets are financed through debt. However, one thing to note with this ratio: it isn't a pure measure of a company's debt (or indebtedness), as it also includes operational liabilities, such as accounts payable and taxes payable.
Targa (NYSE:TRGP) has moved up 1.6% and is currently trading at $42.89 per share. The company is currently trading a volume of 201,503 shares. Price change alone is not enough to know how a stock is doing. Volume is an important secondary indicator used to confirm trends suggested by price movement. Profit-margin ratios help us to keep score, as measured over time, of management's ability to generate profits and manage costs and expenses. There are three key profit-margin ratios: gross profit margin, operating profit margin and net profit margin. TRGP has a low gross profit margin of 10.1%. This may mean that the company is struggling to control production costs, or that a low amount of earnings is being generated from revenues. While ratios such as price/earnings (P/E) or price/book value look at the relative attractiveness of a stock, the net profit margin ratio focuses on company performance rather that stock market valuation. The company's net margin is 0.5%, which is low compared to its gross margin. A low profit margin may indicate a pricing strategy.
Investment valuation ratios can be very useful in determining the value of a stock, but it is very important to keep in mind that while some financial ratios have general rules (or a broad application), in most instances it is a prudent practice to look at a company's historical performance and use peer company/industry comparisons to put any given company's ratio in perspective. The debt-equity (D/E) ratio is a leverage ratio. TRGP has a high D/E ratio of 1048%. Generally, a high D/E ratio means that the company may have difficulty generating enough cash to pay off its debts. The D/E ratio is not a pure measurement of a company's debt because it includes operational liabilities in total liabilities.
After an increase of 1.6%, TransCanada Corporation (NYSE:TRP) has reached a current price of $42.44. With 217,128 shares changing hands so far today, the company's volume is 0.6 times its average over the past three months. Volume is an important indicator because it indicates how significant a price shift is. Margin analysis is a great way to understand the profitability of companies. TRP's gross profit margin is 61.1%. Ideally, a company's profit margin should be stable or rising; declining profit margin should be cause for concern or further investigation. The company's net profit margin is 17.1%.
Valuation ratios like the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield are useful in determining how attractive a potential or existing investment is. The capitalization ratio measures the debt component of the capital structure, or capitalization of a company (i.e., the sum of long-term debt liabilities and shareholder equity) to support operations and growth. TRP has a high capitalization ratio of 53%. A company considered too highly leveraged (too much debt) may find its freedom of action restricted by its creditors and/or have its profitability hurt by high interest costs. This ratio is considered to be one of the more meaningful of the "debt" ratios - it delivers the key insight into the use of leverage by a company.
The Bottom Line No matter the economic climate, Wall Street will always have stocks that make major moves each week. Paying close attention to the previous ratios will help you identify key times to adjust your strategy. However, these fundamental metrics must be analyzed with historic data, industry information in addition to firm specific financial statements.
by
Investopedia Staff
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