What Are the Fundamentals Of EPD?

Enterprise Products Partners logged a -0.3% change during today's morning session, and is now trading at a price of $26.7 per share.

Over the last year, Enterprise Products Partners logged a 2.0% change, with its stock price reaching a high of $27.36 and a low of $22.9. Over the same period, the stock underperformed the S&P 500 index by -3.0%. As of April 2023, the company's 50-day average price was $26.45. Enterprise Products Partners L.P. provides midstream energy services to producers and consumers of natural gas, natural gas liquids (NGLs), crude oil, petrochemicals, and refined products. The large-cap Utilities company is based in Houston, TX. Enterprise Products Partners has offered a 7.3% dividend yield over the last 12 months.

Exceptional Profitability Overshadowed by Excessive Leverage:

2019-12-31 2020-12-31 2021-12-31 2022-12-31
Revenue (MM) $32,789 $27,200 $40,807 $58,186
Gross Margins 17.5% 17.8% 14.0% 11.5%
Operating Margins 16.8% 17.0% 13.5% 11.1%
Net Margins 14.0% 13.88% 11.36% 9.44%
Net Income (MM) $4,591 $3,776 $4,638 $5,490
Net Interest Expense (MM) -$1,243 -$1,287 -$1,283 -$1,244
Depreciation & Amort. (MM) -$1,949 -$2,072 -$1,874 -$1,974
Earnings Per Share $2.09 $1.71 $2.1 $2.54
EPS Growth n/a -18.18% 22.81% 20.95%
Diluted Shares (MM) 2,202 2,202 2,203 2,175
Free Cash Flow (MM) $1,989 $2,604 $6,289 $6,075
Capital Expenditures (MM) -$4,532 -$3,288 -$2,223 -$1,964
Net Current Assets (MM) -$28,043 -$28,820 -$27,818 -$29,808
Current Ratio 0.86 1.1 1.14 0.86
Long Term Debt (MM) $25,643 $28,541 $28,135 $26,551
Net Debt / EBITDA 3.49 4.11 3.4 3.21

Enterprise Products Partners has strong margins with a negative growth trend and growing revenues and decreasing reinvestment in the business. Additionally, the company's financial statements display positive EPS growth and generally positive cash flows. However, the firm suffers from slimmer gross margins than its peers and a highly leveraged balance sheet.

A Very Low P/E Ratio but Trades Above Its Graham Number:

Enterprise Products Partners has a trailing twelve month P/E ratio of 10.4, compared to an average of 22.89 for the Utilities sector. Based on its EPS guidance of $2.66, the company has a forward P/E ratio of 9.9. The 4.9% compound average growth rate of Enterprise Products Partners's historical and projected earnings per share yields a PEG ratio of 2.11. This suggests that these shares are overvalued. Furthermore, Enterprise Products Partners is likely overvalued compared to the book value of its equity, since its P/B ratio of 2.15 is higher than the sector average of 1.03. The company's shares are currently trading 10.0% above their Graham number.

There's an Analyst Consensus of Some Upside Potential for Enterprise Products Partners:

The 19 analysts following Enterprise Products Partners have set target prices ranging from $30.0 to $36.0 per share, for an average of $32.16 with a buy rating. As of April 2023, the company is trading -17.8% away from its average target price, indicating that there is an analyst consensus of some upside potential.

Enterprise Products Partners has a very low short interest because 1.1% of the company's shares are sold short. Institutions own 26.7% of the company's shares, and the insider ownership rate stands at 32.66%, suggesting a large amount of insider shareholders. The largest shareholder is Marquard & Bahls Ag, whose 2% stake in the company is worth $986,528,450.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.