Rating Change #8
Dollar Thrifty Automotive Group (DTG) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, notable return on equity, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- DOLLAR THRIFTY AUTOMOTIVE GP's earnings per share declined by 41.8% in the most recent quarter compared to 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, DOLLAR THRIFTY AUTOMOTIVE GP increased its bottom line by earning $4.34 versus $1.84 in the prior year. This year, the market expects an improvement in earnings ($4.59 versus $4.34).
- 48.80% is the gross profit margin for DOLLAR THRIFTY AUTOMOTIVE GP which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, DTG's net profit margin of 4.70% significantly trails the industry average.
- Net operating cash flow has significantly increased by 51.74% to $151.32 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 26.70%.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Road & Rail industry and the overall market, DOLLAR THRIFTY AUTOMOTIVE GP's return on equity exceeds that of both the industry average and the S&P 500.
- Compared to its closing price of one year ago, DTG's share price has jumped by 82.24%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, DTG should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
Dollar Thrifty Automotive Group, Inc. through its subsidiaries, rents and leases vehicles through company owned and franchised stores under Dollar and the Thrifty brand names primarily in the United States and Canada. The company also operates a franchised retail used car sales network. The company has a P/E ratio of 21.1, equal to the average diversified services industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Dollar Thrifty Automotive Group has a market cap of $2.4 billion and is part of the services sector and diversified services industry. Shares are up 73.1% year to date as of the close of trading on Tuesday.You can view the full Dollar Thrifty Automotive Group Ratings Report or get investment ideas from our investment research center.
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