TSC Ratings' Updates: Hawaiian Electric Industries

UA's debt-to-equity ratio is very low at 0.10 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.22, which illustrates the ability to avoid short-term cash problems.

UA 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. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, UA increased its bottom line by earning $1.05 vs. 79 cents in the prior year. This year, the market expects an improvement in earnings ($1.18 vs. $1.05).

Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 48.48%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 72.72% compared with the year-earlier quarter. Although its share price is down sharply from a year ago, do not assume that it can now be tagged as cheap and attractive. The reality is that, based on its current price in relation to its earnings, UA is still more expensive than most of the other companies in its industry.

The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared with that of the S&P 500 and the textiles, apparel & luxury goods industry. The net income has significantly decreased by 75.9% when compared with the same quarter one year ago, falling from $5.71 million to $1.38 million.