CHINA GERUI ADV MATERIALS GP's gross profit margin for the third quarter of its fiscal year 2014 has significantly decreased when compared to the same period a year ago. Sales and net income fell significantly; although net income growth outperformed the average competitor in its industry, revenue growth did not. CHINA GERUI ADV MATERIALS GP has very weak liquidity. Currently, the Quick Ratio is 0.23 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.
During the same period, stockholders' equity ("net worth") has decreased by 15.83% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.
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|Income Statement||Q3 FY14||Q3 FY13|
|Net Sales ($mil)||3.1||30.93|
|Net Income ($mil)||-33.04||-4.37|
|Balance Sheet||Q3 FY14||Q3 FY13|
|Cash & Equiv. ($mil)||54.09||376.55|
|Total Assets ($mil)||499.0||694.9|
|Total Debt ($mil)||217.11||363.18|
|Profitability||Q3 FY14||Q3 FY13|
|Gross Profit Margin||-73.43||12.13|
|Return on Assets||-9.5||-0.84|
|Return on Equity||-18.51||-1.92|
|Debt||Q3 FY14||Q3 FY13|
|Share Data||Q3 FY14||Q3 FY13|
|Shares outstanding (mil)||5.94||5.95|
|Div / share||0.0||0.0|
|Book value / share||43.13||51.12|
|Institutional Own %||n/a||n/a|
|Avg Daily Volume||212272.0||43866.0|
SELL. The current P/E ratio is negative, which has no meaningful value in the assessment of premium or discount valuation, it simply displays that the company has negative earnings. For additional comparison, its price-to-book ratio of 0.06 indicates a significant discount versus the S&P 500 average of 2.81 and a significant discount versus the industry average of 1.59. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. After reviewing these and other key valuation criteria, CHINA GERUI ADV MATERIALS GP proves to trade at a discount to investment alternatives within the industry.
|CHOP NM||Peers 27.69||CHOP NM||Peers 8.65|
Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.
CHOP's P/E is negative making this valuation measure meaningless.
Neutral. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.
CHOP's P/CF is negative making the measure meaningless.
|CHOP NA||Peers 22.41||CHOP NA||Peers 1.41|
Neutral. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth potential.
Ratio not available.
Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.
Ratio not available.
|CHOP 0.06||Peers 1.59||CHOP -788.88||Peers 85.54|
Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.
CHOP is trading at a significant discount to its peers.
Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.
However, CHOP is expected to significantly trail its peers on the basis of its earnings growth rate.
|CHOP 0.15||Peers 2.41||CHOP -40.90||Peers 47.83|
Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.
CHOP is trading at a significant discount to its industry on this measurement.
Lower. A sales growth rate that trails the industry implies that a company is losing market share.
CHOP significantly trails its peers on the basis of sales growth
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