NEW YORK (TheStreet) -- The Fresh Market
(TFM - Get Report) shares are down -2.4% to $33.55 in pre-market trading on Thursday after having coverage initiated with a "neutral" rating and $34 price target by analysts at Wedbush.
The new price target represents a 1.3% decline from the stock's previous closing price.
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TheStreet Ratings team rates FRESH MARKET INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:"We rate FRESH MARKET INC (TFM) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and premium valuation." Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 4.7%. Since the same quarter one year prior, revenues rose by 19.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- TFM's debt-to-equity ratio is very low at 0.13 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.25 is very weak and demonstrates a lack of ability to pay short-term obligations.
- FRESH MARKET INC's earnings per share declined by 25.0% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, FRESH MARKET INC reported lower earnings of $1.05 versus $1.34 in the prior year. This year, the market expects an improvement in earnings ($1.57 versus $1.05).
- The gross profit margin for FRESH MARKET INC is currently lower than what is desirable, coming in at 34.04%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 2.69% trails that of the industry average.
- Net operating cash flow has decreased to $12.04 million or 49.23% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- You can view the full analysis from the report here: TFM Ratings Report