NEW YORK (TheStreet) -- Bridgeline Digital (Nasdaq:BLIN) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its weak operating cash flow and feeble growth in its earnings per share.
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- Net operating cash flow has significantly decreased to -$0.06 million or 116.51% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- BRIDGELINE DIGITAL INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, BRIDGELINE DIGITAL INC reported poor results of -$0.06 versus -$0.03 in the prior year. For the next year, the market is expecting a contraction of 33.3% in earnings (-$0.08 versus -$0.06).
- 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 Internet Software & Services industry and the overall market, BRIDGELINE DIGITAL INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Although BLIN's debt-to-equity ratio of 0.25 is very low, it is currently higher than that of the industry average. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.96 is somewhat weak and could be cause for future problems.
- The gross profit margin for BRIDGELINE DIGITAL INC is rather high; currently it is at 55.70%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -2.50% is in-line with the industry average.
-- Written by a member of TheStreet Ratings Staff
TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
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