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It is one of the largest integrated utilities and the 5th largest electric generating company in Brazil. Long-term growth prospects appear to be bright for the company as electricity demand is set to rise over the years to come. The government projects that demand will rise by 5% year over year for the next decade. The company is working hard to increase its capacity in order to deal with the rising demand. It has 13% of the market share, with more than 10, 000Km of transmission lines across the country.It is also involved in natural-gas distribution and telecommunications.

Reasons to be bullish on Cia Energetica de Minas Gerais (NYSE:CIG):

  • A positive levered free cash flow of $185 million
  • A good relative strength score of 76 out of a possible 100
  • A profit margin of 15.4%
  • A decent quarterly revenue growth 15.1%
  • Net income increased from $899 million in 2009 to $1.45 billion in 2011
  • A good quarterly earnings growth rate of 20%
  • Cash flow increased from $1.54 in 2009 to $2.18 in 2011
  • Annual EPS before NRI increased from $0.98 to $1.90 in 2011
  • A good yield of 5.7%
  • A manageable payout ratio of 63%
  • A good 5 year ROE average of 19.4%
  • A long term debt to equity ratio of 0.68
  • A decent interest coverage ratio of 2.6
  • A great free cash flow yield of 11%
  • A good 5 year sales growth rate of 17.2%


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Company: Cia Energetica de Minas Gerais

Levered Free Cash Flow = 185M


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Brief Overview

  1. Relative Strength 52 weeks = 76
  2. Cash Flow 5-year Average = 1.56
  3. Profit Margin = 0.1541
  4. Operating Margin = 0.2801
  5. Quarterly Revenue Growth = 0.151
  6. Quarterly Earnings Growth = 0.2
  7. Operating Cash Flow = 1.98B
  8. Beta = 0.99

Growth

  1. Net Income ($mil) 12/2011 = 1451
  2. Net Income ($mil) 12/2010 = 1289
  3. Net Income ($mil) 12/2009 = 899
  4. Net Income Reported Quarterly ($mil) = 358
  5. EBITDA ($mil) 12/2011 = 2580
  6. EBITDA ($mil) 12/2010 = 2122
  7. EBITDA ($mil) 12/2009 = 1670
  8. Cash Flow ($/share) 12/2011 = 2.18
  9. Cash Flow ($/share) 12/2010 = 2.19
  10. Cash Flow ($/share) 12/2009 = 1.54
  11. Sales ($mil) 12/2011 = 8489
  12. Sales ($mil) 12/2010 = 7734
  13. Sales ($mil) 12/2009 = 5970
  14. Annual EPS before NRI 12/2007 = 0.98
  15. Annual EPS before NRI 12/2008 = 1.11
  16. Annual EPS before NRI 12/2009 = 1.22
  17. Annual EPS before NRI 12/2010 = 1.64
  18. Annual EPS before NRI 12/2011 = 1.9

Dividend history

  1. Dividend Yield = 5.73%
  2. Dividend Yield 5 Year Average 03/2012 = 2.79
  3. Dividend 5 year Growth 03/2012 = 36.2

Dividend sustainability

  1. Payout Ratio = 0.63
  2. Payout Ratio 5 Year Average 03/2012 = 0.29

Performance

  1. ROE 5 Year Average 03/2012 = 19.45
  2. Current Ratio 03/2012 = 0.9
  3. Current Ratio 5 Year Average = 1.31
  4. Quick Ratio = 0.7
  5. Cash Ratio = 0.49
  6. Interest Coverage Quarterly = 2.6%

Interesting companies

For investors looking for other ideas detailed data has been provided on two additional companies.

Company: Kraft Foods Inc (KFT)

Basic Key ratios

  1. Percentage Held by Insiders = 0.36
  2. Number of Institutional Sellers 12 Weeks = 1
  3. Relative Strength 52 weeks = 79
  4. Dividend 5-year Growth = 2.07
  5. Cash Flow 5-year Average = 2.61
  6. Dividend Yield 5-Year Average = 3.71

Growth

  1. Net Income ($mil) 12/2011 = 3527
  2. Net Income ($mil) 12/2010 = 4114
  3. Net Income ($mil) 12/2009 = 3021
  4. Net Income Reported Quarterly ($mil) = 813
  5. EBITDA ($mil) 12/2011 = 8142
  6. EBITDA ($mil) 12/2010 = 7106
  7. EBITDA ($mil) 12/2009 = 6114
  8. Cash Flow ($/share) 12/2011 = 3.14
  9. Cash Flow ($/share) 12/2010 = 2.81
  10. Cash Flow ($/share) 12/2009 = 2.66
  11. Sales ($mil) 12/2011 = 54365
  12. Sales ($mil) 12/2010 = 49207
  13. Sales ($mil) 12/2009 = 40386
  14. Annual EPS before NRI 12/2007 = 1.82
  15. Annual EPS before NRI 12/2008 = 1.81
  16. Annual EPS before NRI 12/2009 = 2.02
  17. Annual EPS before NRI 12/2010 = 2.02
  18. Annual EPS before NRI 12/2011 = 2.29


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Dividend history

  1. Dividend Yield = 3.00
  2. Dividend Yield 5 Year Average = 3.71
  3. Dividend 5 year Growth = 2.07

Dividend sustainability

  1. Payout Ratio 09/2011 = 0.5
  2. Payout Ratio 5 Year Average = 0.57
  3. Change in Payout Ratio = -0.07

Performance

  1. Next 3-5 Year Estimate EPS Growth rate = 8
  2. 5 Year History EPS Growth = 4.35
  3. ROE 5 Year Average = 10.91
  4. Current Ratio = 0.92
  5. Current Ratio 5 Year Average = 0.97
  6. Quick Ratio = 0.57
  7. Cash Ratio = 0.22
  8. Interest Coverage Quarterly = 3.06

Company: Nabors Industries (NYSE:NBR)

Basic Key ratios

  1. Percentage Held by Insiders = 8.62
  2. Relative Strength 52 weeks = 20
  3. Cash Flow 5-year Average = 4.87
  4. Dividend Yield 5-Year Average = 0

Growth

  1. Net Income ($mil) 12/2011 = 244
  2. Net Income ($mil) 12/2010 = 95
  3. Net Income ($mil) 12/2009 = -86
  4. Net Income Reported Quarterlies ($mil) = 134
  5. EBITDA ($mil) 12/2011 = 1750
  6. EBITDA ($mil) 12/2010 = 1437
  7. EBITDA ($mil) 12/2009 = 1109
  8. Cash Flow ($/share) 12/2011 = 5.13
  9. Cash Flow ($/share) 12/2010 = 4.1
  10. Cash Flow ($/share) 12/2009 = 4.04
  11. Sales ($mil) 12/2011 = 6137
  12. Sales ($mil) 12/2010 = 4216
  13. Sales ($mil) 12/2009 = 3503
  14. Annual EPS before NRI 12/2007 = 3.05
  15. Annual EPS before NRI 12/2008 = 3.14
  16. Annual EPS before NRI 12/2009 = 1.29
  17. Annual EPS before NRI 12/2010 = 1.03
  18. Annual EPS before NRI 12/2011 = 1.61


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Performance

  1. Next 3-5 Year Estimate EPS Growth rate = 27.55
  2. 5 Year History EPS Growth 12/2011 = -23.9
  3. ROE 5 Year Average 12/2011 = 12.69
  4. Return on Investment 06/2011 = 4.55
  5. Debt/Total Cap 5 Year Average 12/2011 = 41.83
  6. Current Ratio 12/2011 = 1.98
  7. Current Ratio 5 Year Average = 2.04
  8. Quick Ratio = 1.56
  9. Interest Coverage Quarterly = 4.39

Conclusion

Long-term investors can use strong pullbacks to open up positions in stocks they would not mind owning for the long haul. A great way to get into a stock at a price of your choosing is to sell puts at strikes you would not mind owning the stock at.

Disclaimer: This list of stocks is meant to serve as a starting point. Please do not treat this as a buying list. It is imperative that you do your due diligence and then determine if any of the above plays meet with your risk tolerance levels. The Latin maxim caveat emptor applies-let the buyer beware.

Source: Cia Energetica De Minas Gerais: Is It Time To Buy?