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Utility Stocks: Key Quantitative Insights for Investors

PART:
1 2 3
Part 3
Utility Stocks: Key Quantitative Insights for Investors PART 3 OF 3

These Utility Stocks Could Be Bearish

Scana

On May 5, Scana (SCG) had a short-interest-to-equity float ratio of 5.2%, the highest among the utility stocks that make up the Utilities Select Sector SPDR ETF (XLU).

These Utility Stocks Could Be Bearish

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In the past three months, Scana has fallen 5.4%. Its short-interest-to-equity float ratio has risen 57.5% during this period. Its net-debt-to-EBITDA ratio is 4.7x. In the last four quarters, Scana’s revenue has remained unchanged, while its adjusted operating profit fell 6.7%. Its operating profit margin is 27.3%. It’s also one of the high implied volatility stocks that we discussed in part one of this series.

The rise in short interest, which reflects expectations of a sharp drop in the stock, could partially explain the rise in its implied volatility. SCG’s exposure to Westinghouse’s bankruptcy could be the reason for the rise in short interest in the stock.

NRG Energy

NRG Energy (NRG) had a short-interest-to-equity float ratio of 4.0%. In the past three months, NRG Energy has fallen 12%. Its short-interest-to-equity float ratio has fallen 20.9% during this period. Its net-debt-to-EBITDA ratio is 8.2x. In the last four quarters, NRG Energy’s revenue has fallen 14.5%, while its adjusted operating income has fallen 80.9%. NRG Energy’s operating profit margin is 7%.

As we saw in the first two parts of this series, NRG Energy had the highest implied volatility among the utility stocks that make up XLU.

Consolidated Edison

Consolidated Edison’s (ED) short-interest-to-equity float ratio is 3.6%. Its net-debt-to-EBITDA ratio is 4.1x. Its stock has risen 7.6% in the last three months, while its short-interest-to-equity float ratio has risen 7%.

In the last four quarters, Consolidated Edison’s revenue has risen 8.7%, and its adjusted operating profit has risen 73.5%. Its operating profit margin is 21.4%.

Dominion Resources

Dominion Resources’ (D) short-interest-to-equity float ratio is 3.4%. Its net-debt-to-EBITDA ratio is 6x. In the last three months, the stock has risen 9.1%, while its short-interest-to-equity-float ratio has risen 22.1%. In the last four quarters, Dominion Resources’ revenue has risen 15.8%, while its adjusted operating profit has risen 30.4%. Its operating profit margin is 32.1%.

Ameren

Ameren’s (AEE) short-interest-to-equity-float ratio is 3.2%. Its net-debt-to-EBITDA ratio is 3.5x. In the last three months, the stock has risen 4%, while its short-interest-to-equity-float ratio has risen 18%. In the last four quarters, Ameren’s revenue has risen 5.6%, and its adjusted operating profit has risen 28.3%. Its operating profit margin is 22.7%.

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