NEW YORK (TheStreet) -- Shares of Annie's Inc. (BNNY) are down -7.17% to $32.38 on Friday after the natural and organic food company posted fourth-quarter earnings that did not meet analysts' estimates.
Annie's reported a fourth-quarter adjusted EPS of 29 cents, which was an increase from the 27 cents reported during the same period last year; however, the company missed the EPS consensus estimate of 34 cents.
The company said it expects adjusted EPS for the full-year 2015 to be between 88 cents and 95 cents, while analysts expect EPS of $1.13.
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"We rate ANNIE'S INC (BNNY) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- BNNY has underperformed the S&P 500 Index, declining 19.52% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
- Net operating cash flow has significantly decreased to -$8.97 million or 77.82% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- 39.59% is the gross profit margin for ANNIE'S INC which we consider to be strong. Regardless of BNNY's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 6.05% trails the industry average.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Food Products industry and the overall market on the basis of return on equity, ANNIE'S INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- BNNY has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, BNNY has a quick ratio of 1.70, which demonstrates the ability of the company to cover short-term liquidity needs.
- You can view the full analysis from the report here: BNNY Ratings Report