NEW YORK (TheStreet) -- Interface (Nasdaq:IFSIA) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
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- Net operating cash flow has significantly increased by 70.88% to -$0.93 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 42.19%.
- INTERFACE INC's earnings per share declined by 20.0% 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, INTERFACE INC increased its bottom line by earning $0.61 versus $0.14 in the prior year. This year, the market expects an improvement in earnings ($0.72 versus $0.61).
- IFSIA, with its decline in revenue, underperformed when compared the industry average of 23.5%. Since the same quarter one year prior, revenues slightly dropped by 4.9%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- Even though the current debt-to-equity ratio is 1.01, it is still below the industry average, suggesting that this level of debt is acceptable within the Commercial Services & Supplies industry. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.25 is sturdy.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Commercial Services & Supplies industry and the overall market, INTERFACE INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
-- 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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