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Leading quantitative indicators on the Fintel platform have rated Genie Energy Ltd (NYSE:GNE) as the company with the highest Quantity, Value and Momentum (QVM) with a bullish 95.41 score, based on This score, based on the three key factors and compared GNE against 3,763 other companies.
Genie Energy is an end-to-end provider of residential and commercial energy services. The company supplies both traditional and renewable/sustainable energy sources to customers.
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Genie operates in three segments: Genie US retail, Genie International retail and Genie Renewables. The US segment provides gas and electricity to customers, while the international segment provides electricity to residential and small business customers in Scandinavia. The renewables segment is broken down into 4 key areas:
Genie Solar which designs and builds local solar installations for small commercial customers CityCom Solar segment recruits customers to purchase electricity that has been generated by community solar fields Prism Solar Technologies which designs and manufacturers specialized solar panels intended for wholesale distribution Diversegy which is an energy broker for commercial customers The business has topped the leaderboard based on each factor showing attractive metrics .
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Genie has a six month momentum score of 93.50, based on the strong share price performance of the stock in this period. GNE's share price has risen almost 60% since the beginning of 2022, outperforming all major indexes. The momentum score ranks GNE in the top 5% of 41,443 companies based on share price momentum.
GNE's market capitalization of $230 million and recent earnings per share of $0.67 at the previous result, give GNE trading ~5x price-to-earnings multiple valuation (PE ratio). This cheap multiple leads to a value score of 93.78, ranking the company in the top 10% of 19,728 screened companies.
The final contributing factor to the QVM score is based on GNE's cash generating efficiencies. The most recent first quarter result saw the GNE generate $98.5 million in revenue and $18.3 million in cash flow from operating activities. The revenue fell 8.3% from the prior year comparison but was compensated by the significant jump in gross margin from 11.8% to 46.2%, driven by the retail US segment. GNE's significant cash generating abilities gives it a quality score of 95.51 and ranks it in the top 1.5% of 13,943 included companies.
GNE's strong cash generation allows it to pay consistent quarterly dividends to investors. The company is currently paying a 7.5 cent quarterly dividend which annualizes to a 3.41% yield for investors.
Looking ahead, management highlighted that the second quarter is typically a period of seasonally lower consumption in the US, although noted that they “expect to again deliver relatively strong results across our retail businesses as we continue to focus on customer portfolio management and margin preservation until we return to a less volatile commodity price environment”
GNE believes the 'debt-free' balance sheet and strong cash flows leave the company positioned well to invest in other growth opportunities.
This positions GNE well in an interest rate rising environment as the stock has a low valuation with no debt and potential upside from future investments and is the likely reason why the stock is trending upwards in this market
Article by Ben Ward, Fintel
Updated on Jul 5, 2022, 4:26 pm
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