Zacks Investment Research downgraded
Datang International Power Generation
) to a Zacks Rank #5 (Strong Sell) on Apr 4, 2013.
BROOKFIELD INFR (BIP): Free Stock Analysis
DATANG INTL PWR (DIPGY): Get Free Report
ENDESA-CHILE (EOC): Free Stock Analysis
PIKE ELECTRIC (PIKE): Free Stock Analysis
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Why the Downgrade?
Datang International reported its year 2012 financial results on
Mar 26, 2013. In local currency, the company's net income more
than doubled with earnings per share showing a hike of 106.7%
year over year. Operating revenue grew 7.2% year over year.
Of the total expense, a decline in costs related to fuel used for
power and heat generation, roughly 50% of total revenue, was a
sign of relief. On the other hand, expenses related to fuel for
coal sales, repairs, salaries and other expenses all increased in
the year, resulting in an overall increase of 2% in total
Increase of 21% in finance costs in the year also impacted
results badly. Also, income tax expenses grew a whopping 104%
year over year. For the year 2013, management anticipates that
slowdown in domestic economic growth will impact its performance
during the year.
A combination of all these factors has brought down earnings
estimates for Datang International in the last 30 days. The Zacks
Consensus Estimate for 2013 has gone down by 9.2% to $1.090 while
for 2014, the estimate plummeted 12.0% to $1.32.
Other Stocks to Consider
Datang International is a China-based $5.9 billion electric
utility. Other stocks to watch out for in the industry are
Brookfield Infrastructure Partners L.P.
Pike Electric Corp
Empresa Nacional de Electricidad S.A.
), each holding a Zacks Rank #1 (Strong Buy).