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Tickers in this Article: KMI, NRGM, PNG, HNP, ENI, EOC, EIX
So far today, the Nasdaq has moved up 0.2%, the S&P 500 remains relatively unchanged and the Dow is trading down 0.2%. 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 up 0.4% overall, and these are the biggest movers in the sector so far:
CompanyMarket CapPercentage Change
Kinder Morgan (NYSE:KMI)$19.55 billion-1.5%
Inergy (NYSE:NRGM)$1.7 billion+1.3%
PAA Natural Gas Storage (NYSE:PNG)$1.54 billion+1.3%
Huaneng Power International, Inc (NYSE:HNP)$10.03 billion-1.2%
Enersis S.A (NYSE:ENI)$10.92 billion+1.2%
Empresa Nacional de Electricidad (NYSE:EOC)$13.47 billion+1.1%
Edison (NYSE:EIX)$14.68 billion-1.1%
Broker Summary: TD Ameritrade Thinkorswim

Currently trading at $33.97 per share, Kinder Morgan (NYSE:KMI) has fallen 1.5%. The company's volume for the day so far is 3.1 million shares. This is consistent with its current daily average. 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 a 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. Investment valuation ratios provide investors with an estimation, albeit a simplistic one, of the value of a stock. The debt-equity (D/E) ratio is a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed. The D/E ratio for KMI is 261%. 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 1.3%, Inergy (NYSE:NRGM) has reached a current price of $22.91. At 1,700 shares, the company's volume so far today is zero times the current three-month average. As a stock moves up or down, it is important to pay attention to the trading volume. This indicates the level of interest: the higher the volume, the more the interest. Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. The capitalization ratio is calculated by dividing long-term debt by the sum of long-term debt and shareholders' equity. The capitalization ratio for NRGM is 36.4%. Prudent use of leverage (debt) increases the financial resources available to a company for growth and expansion.

PAA Natural Gas Storage (NYSE:PNG) is at $18.40 per share after an increase of 1.3%. So far today, 31,972 shares have changed hands. Volume indicates the level of interest that investors have in a company at its current price. 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. A simple P/E ratio can reveal the stock's real market value and show how the valuation compares to its industry group or a benchmark like the S&P 500 Index. The P/E ratio for PNG is 19.3, below the industry average of 24.06. A low P/E ratio may indicate that the market expects relatively slower earnings growth. High P/E stocks could be "growth" stocks, while low PE stocks may be "value" stocks. SEE: Profit With The Power Of Price-To-Earnings

Huaneng Power International, Inc (NYSE:HNP) is currently trading at a share price of $28.20, a 1.2% decline. The company's volume is currently 6,573 shares for the day, while it was 87,848 shares yesterday. If a stock price moves on high volume, this means that the change is a significant one. 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 price/earnings to growth (PEG) ratio divides a company's P/E ratio by its growth rate of earnings-per-share. HNP has a PEG ratio of 6.23. While P/E ratios are important indicators of market value, a high P/E in and of itself is not bad because it may indicate a company whose earnings are growing very rapidly, so many investors look at the PEG ratio in order to get an idea of whether or not a particular P/E ratio is justified by underlying earnings growth.

Enersis S.A (NYSE:ENI) is currently trading at $16.92 per share, a 1.2% increase. The company's volume for the morning is 110,941 shares. This is 0.2 times its average daily volume. If a stock is trading on low volume, then there is not much interest in the stock. On the other hand, if a stock is trading on high volume, then there is a lot of interest in the stock. Valuation ratios include 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. The debt ratio shows the proportion of assets that a company is financing through debt. ENI has a debt ratio of 70.9%, which is on the high side. This means that most of the company's assets are financed through debt. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.

Empresa Nacional de Electricidad (NYSE:EOC) has risen 1.1% and is currently trading at $49.82 per share. The company's volume is currently 21,800 shares for the day, 0.2 times its current three-month average. In technical analysis, trading volume is used to determine the strength of a market indicator. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. The dividend yield is measured by taking the annual dividends per share and dividing that number by the stock price. EOC has a dividend yield of 4.2%. Simply comparing the level of dividends that two stocks pay does not give a true reflection of which security is more attractive, so investors calculate the dividend yield in order to standardize dividend payments. SEE: Guide To Stock-Picking Strategies: Income Investing

At $44.57, Edison (NYSE:EIX) has slipped 1.1%. So far today, the company's volume is 497,174 shares. A stock's volume conveys how excited investors are about it. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. A price/sales ratio is derived by dividing stock market price by company sales. EIX has a high P/S ratio of 1.17. This could be a good sign if the share price increases. All things being equal, a low P/S ratio is good news for investors, while a very high one can be a warning sign.

The Bottom Line On any given day, a particular stock may see positive or negative change in its share price. It is important to weigh current activity against historical performance when making any investment decisions. Keep in mind that all these ratios should be compared against historical numbers and industry information in order to get a more complete picture.

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