Rating Change #3
Stanley Furniture Company Inc
(STLY - Get Report)
has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its notable return on equity and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and weak operating cash flow.
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Highlights from the ratings report include:
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Household Durables industry and the overall market, STANLEY FURNITURE CO INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Despite the weak revenue results, STLY has outperformed against the industry average of 28.2%. Since the same quarter one year prior, revenues slightly dropped by 2.7%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- The gross profit margin for STANLEY FURNITURE CO INC is currently extremely low, coming in at 14.70%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -8.03% is significantly below that of the industry average.
- Net operating cash flow has significantly decreased to -$7.03 million or 119.45% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
Stanley Furniture Company, Inc. designs, manufactures, and imports wood furniture for the residential market in the United States. The company has a P/E ratio of two, below the S&P 500 P/E ratio of 17.7. Stanley Furniture has a market cap of $59.4 million and is part of the consumer goods sector and consumer durables industry. Shares are down 8.9% year to date as of the close of trading on Friday.
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