NEW YORK (TheStreet) --Shares of Gain Capital Holdings Inc. (GCAP - Get Report) are down -16.14% to $8.16 on Friday after the company reported net income for the 2014 first quarter declined to $1.6 million, or 4 cents per diluted share, compared to $4.3 million, or 11 cents per diluted share from the same period last year.
Revenue for the independent provider of online forex trading increased 52% to $75.8 million versus $49.8 million from the 2013 first quarter.
TheStreet Ratings team rates GAIN CAPITAL HOLDINGS INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate GAIN CAPITAL HOLDINGS INC (GCAP) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- GCAP's very impressive revenue growth greatly exceeded the industry average of 5.5%. Since the same quarter one year prior, revenues leaped by 158.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Although GCAP's debt-to-equity ratio of 0.28 is very low, it is currently higher than that of the industry average.
- Powered by its strong earnings growth of 190.90% and other important driving factors, this stock has surged by 121.01% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, GCAP should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- GAIN CAPITAL HOLDINGS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, GAIN CAPITAL HOLDINGS INC increased its bottom line by earning $0.79 versus $0.04 in the prior year. This year, the market expects an improvement in earnings ($0.95 versus $0.79).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Diversified Financial Services industry. The net income increased by 212.6% when compared to the same quarter one year prior, rising from -$3.79 million to $4.27 million.
- You can view the full analysis from the report here: GCAP Ratings Report