The utility industry is a very productive race for the past year has had, and many investors now feel that all companies are overvalued in this area. While this empirical proposition is true to an extent that does not mean that firms do not grow in these areas and help them benefit from their financial reports to improve the shareholders. Gas utility sector, with the market leaders of the CAP, as National Grid, and Sempra Energy, Kinder Morgan, one can say that one of these mountingIndustry, because there is great potential for growth in each of these companies. But an individual company, TransCanada (TRP), to 19.6 billion dollars in large cap stocks, not only has a strong potential for economic expansion, but because of its business strategy, TransCanada has a strong potential for escalation financial growth.
Looking at this business plan will use the Trans Canada to increase its revenue, according to Reuters, the company "is an energy in North AmericaInfrastructure company focused on pipelines and energy. came "in Calgary, Alberta is about 50% of sales come from energy, and 50% of the sales pipeline. The section of pipe of this business model is the product of natural gas distributed in various regions of Canada and Member USA. Since the Natural Gas Futures NYMEX Henry Hub 12-month futures strip price average, have increased more than 30% since the beginning of 2007, and there is great potential foractive hurricane season, according to NOAA, which may further exacerbate the price that will benefit companies such as TransCanada ultimately, this unpleasant news for consumers. The second part of the Trans Canada, energy, may also benefit from higher prices of electricity. According to the PJM Western Electricity has increased its prices since early 2007, over 50%. And usually in August, especially if there is an active hurricane season could explode at current ratesas shown in 2005, and once again the recipient companies to deal specifically with energy for Italy Trans. But regardless of whether it is actually an active hurricane season or not, on the basis of price, this company has performed very well in all scenarios. In each of the last four years, TransCanada has successfully completed by the beginning of the year until the end with many of these years, the investment income produced by over 20%. Therefore, because of fixedBusiness plan and the inevitable increase of raw materials in the coming months and years to realize the potential for a company like TransCanada financially at a high level is strong.
However, while the situation might be different, there are many companies in similar models of gas utility business, compared to the Trans Canada. However, it is what the company from the rest of the industry has a strong historical basis and is projected. From the top line, abouttwelve months has seen a final basis, the Trans Canada from Capital IQ, from year to year quarterly sales growth exceeding 27%. Comparing this data to competitors such as Kinder Morgan and Sempra Energy, and the corresponding figures of -10% and -8.50% is shown. Obviously there is a difference in demand and prices between these companies. But the question to ask now whether these numbers are sustainable. Probably read the two most important statistics in determining the purchaseThe shares are in favor of the Trans Canada operating margins and gross margins are. As an average for five years, according to Reuters TransCanada sees gross margins of 75.14% and operating margins to increase an increase of 35.52%, respectively. Looking at the respective averages of the sector by 14.64% and 33.53%, TransCanada has phenomenal numbers. Even some of the above competitors against which this society much better. National Grid has seen only a strength of 23.74% increase in operating margins, while Sempra Energyonly saw an increase of 13.12% for the same statistics. And drill down these figures spent more interest, taxes and other costs will still show that the net profit remains strong for this company.
Like an average of five years, the Trans Canada have a net profit of about 17.18%. This figure is higher than the industry average of 9.11% and the respective number of National Grid, and Sempra Energy, Kinder Morgan. However, many investors may wonder whether the majority of this growth, transcends an underestimate of the state ofthis heritage. A look at the forward P / E for the Trans Canada, while the number is less than the following different and the industry average of about 29.47, as some more 'than companies like National Grid, and Sempra. Furthermore, the current multiple Trans Canada, as the sale price-(2.64), enterprise value to sales (4.24) and Enterprise Value to EBITDA (9.836) or all above or very close to the companies referred upon. So, unfortunately I can not label the Trans Canadahas as its value. However, it is important to recognize that this company has provided for the amazing growth and growth history. If these numbers are sustainable and nothing bad happened, the company is legally or naturally, see the company continue to higher EPS estimates. Then, as more investors see the benefits that will be with this company, the shares of Trans-Canada continues with a strong positive correlation, as seen in the last four years escalation.
What the Trans Canadawill help in attaining this higher priced shares, is a strong management team. Led by CEO Harold Kvisle this company with its 2350 strong staff management reports in the past has seen, and should continue to do so. ROE figures for the industry and the company's competitors on average 12.84% last year. ROA and ROI of 4.17% and 4.82% were also strong, both close to or above the industry average. TransCanada continues to invest heavily in new capital, such as five yearsaverage growth of 26.15% for this type of expenditure is well above the industry average of 18.50%. And nothing terrible in terms of overall features of this company, and should continue to do well in terms of performance in the coming months and years.
Therefore, after reviewing the strategy and the basis for the Trans Canada, you should at least different reasons, consider buying shares of this company. The dividend yield of 3.48% is above the industry averageAverage, and should be another advantage for investors, since society. Once again the potential, there is great for the growth of this company, especially because it is so dependent on raw materials, the increase in the coming months. High commodity prices mean high numbers and strong core earnings to investors in the company.
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