Rating Change #8
has been downgraded by TheStreet Ratings from buy to hold. Among the primary strengths of the company is its solid financial position based on a variety of debt and liquidity measures that we have evaluated. At the same time, however, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income.
Highlights from the ratings report include:
- DIOD's debt-to-equity ratio is very low at 0.08 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 2.88, which clearly demonstrates the ability to cover short-term cash needs.
- The revenue fell significantly faster than the industry average of 20.0%. Since the same quarter one year prior, revenues fell by 10.4%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 30.61%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 76.19% compared to 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, DIOD is still more expensive than most of the other companies in its industry.
- The gross profit margin for DIODES INC is currently lower than what is desirable, coming in at 33.50%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 3.40% significantly trails the industry average.
- Net operating cash flow has decreased to $13.45 million or 14.51% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, DIODES INC has marginally lower results.
Diodes Incorporated, together with its subsidiaries, designs, manufactures, and supplies application specific standard products in the discrete, logic, and analog semiconductor markets primarily in Asia, North America, and Europe. The company has a P/E ratio of 24.4, below the average electronics industry P/E ratio of 24.7 and above the S&P 500 P/E ratio of 17.7. Diodes has a market cap of $854.2 million and is part of the
industry. Shares are down 11.9% year to date as of the close of trading on Tuesday.
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