Does Energy Transfer Partners LP’s (NYSE:ETP) Past Performance Indicate A Stronger Future?
Assessing Energy Transfer Partners LP’s (NYSE:ETP) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess ETP’s recent performance announced on 30 September 2017 and evaluate these figures to its long-term trend and industry movements. Check out our latest analysis for Energy Transfer Partners
Were ETP’s earnings stronger than its past performances and the industry?
I prefer to use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This enables me to examine various companies in a uniform manner using new information. For Energy Transfer Partners, its most recent trailing-twelve-month earnings is -$425.0M, which, against the previous year’s level, has become less negative. Since these figures are fairly nearsighted, I have computed an annualized five-year figure for ETP’s net income, which stands at $135.0M.
Additionally, we can assess Energy Transfer Partners’s loss by looking at what has been happening in the industry as well as within the company. Firstly, I want to quickly look into the line items. Revenue growth over the last couple of years has grown by 13.35%, implying that Energy Transfer Partners is in a high-growth period with expenses shooting ahead of elevated top-line growth rates, leading to yearly losses. Viewing growth from a sector-level, the US oil and gas industry has been growing its average earnings by double-digit 18.47% over the past twelve months, . This is a change from a volatile drop of -7.16% in the past couple of years. This shows that, although Energy Transfer Partners is presently running a loss, it may have only just gained from the recent industry expansion, moving earnings towards to right direction.
What does this mean?
Though Energy Transfer Partners’s past data is helpful, it is only one aspect of my investment thesis. With companies that are currently loss-making, it is always hard to forecast what will happen in the future and when. The most valuable step is to examine company-specific issues Energy Transfer Partners may be facing and whether management guidance has steadily been met in the past. You should continue to research Energy Transfer Partners to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for ETP’s future growth? Take a look at our free research report of analyst consensus for ETP’s outlook.
2. Financial Health: Is ETP’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 30 September 2017. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
