On Friday, the French network equipment maker reported quarterly net losses of 75 million Euros, or 3 Euro cents a share, one-fifth losses a year earlier. At the end of last year, Alcatel-Lucent earned its first quarterly profit since early 2012, proving the company is making headway with its restructuring plans.
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- Powered by its strong earnings growth of 105.37% and other important driving factors, this stock has surged by 171.62% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- ALCATEL-LUCENT 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 year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, ALCATEL-LUCENT continued to lose money by earning -$0.80 versus -$1.56 in the prior year. This year, the market expects an improvement in earnings ($0.07 versus -$0.80).
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 3.5%. Since the same quarter one year prior, revenues slightly dropped by 1.2%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- Net operating cash flow has declined marginally to $670.46 million or 1.08% when compared to the same quarter last year. Despite a decrease in cash flow ALCATEL-LUCENT is still fairing well by exceeding its industry average cash flow growth rate of -16.15%.
- The debt-to-equity ratio is very high at 2.10 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, ALU's quick ratio is somewhat strong at 1.07, demonstrating the ability to handle short-term liquidity needs.
- You can view the full analysis from the report here: ALU Ratings Report