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Enbridge (ENB) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research
Ethan Allen (ETH) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

In the latest trading session, Enbridge (ENB) closed at $35.39, marking a -0.34% move from the previous day. This move lagged the S&P 500's daily gain of 0.47%. Meanwhile, the Dow gained 0.3%, and the Nasdaq, a tech-heavy index, added 1.05%.

Heading into today, shares of the oil and natural gas transportation and power transmission company had lost 2.85% over the past month, lagging the Oils-Energy sector's loss of 1.5% and the S&P 500's loss of 0.08% in that time.

Investors will be hoping for strength from ENB as it approaches its next earnings release. The company is expected to report EPS of $0.39, down 37.1% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $1.91 per share and revenue of $37.15 billion, which would represent changes of -6.83% and -3.45%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for ENB. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 8.61% higher within the past month. ENB currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that ENB has a Forward P/E ratio of 18.64 right now. For comparison, its industry has an average Forward P/E of 16.05, which means ENB is trading at a premium to the group.

Meanwhile, ENB's PEG ratio is currently 2.17. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. ENB's industry had an average PEG ratio of 4.38 as of yesterday's close.

The Oil and Gas - Production and Pipelines industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 183, putting it in the bottom 29% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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