NEW YORK (TheStreet) -- Cumberland Pharmaceuticals (Nasdaq:CPIX) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and impressive record of earnings per share growth. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year. Highlights from the ratings report include:
- CPIX's revenue growth has slightly outpaced the industry average of 6.4%. Since the same quarter one year prior, revenues slightly increased by 7.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- CPIX's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 10.14, which clearly demonstrates the ability to cover short-term cash needs.
- The gross profit margin for CUMBERLAND PHARMACEUTICALS is currently very high, coming in at 90.30%. Regardless of CPIX's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 14.10% trails the industry average.
- 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. In comparison to the other companies in the Pharmaceuticals industry and the overall market, CUMBERLAND PHARMACEUTICALS's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- CPIX has underperformed the S&P 500 Index, declining 23.40% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
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