NEW YORK (
-- Acco Brands Corporation
) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we find that the company's profit margins have been poor overall.
Highlights from the ratings report include:
- The gross profit margin for ACCO BRANDS CORP is currently lower than what is desirable, coming in at 33.80%. Regardless of ABD's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 1.80% trails the industry average.
- Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.
- Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.12 is sturdy.
- ABD's revenue growth has slightly outpaced the industry average of 0.9%. Since the same quarter one year prior, revenues slightly increased by 5.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
ACCO Brands Corporation designs, develops, manufactures, and markets traditional and computer-related office products and supplies principally in North America, Europe, and Australia. The company has a P/E ratio of 48, above the average consumer non-durables industry P/E ratio of 43.6 and above the S&P 500 P/E ratio of 16.6. Acco has a market cap of $527.3 million and is part of the
industry. Shares are up 11.5% year to date as of the close of trading on Monday.
You can view the full
or get investment ideas from our