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Cavalier Homes (CAV), a manufactured home company, has been downgraded to sell from hold. The company has shown feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and weak operating cash flow.
Cavalier Homes has experienced a steep decline in earnings per share in the most recent quarter in comparison with its performance from the same quarter a year ago. Earnings per share have declined over the last two years. Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. It had been rated a hold since August 2006.