Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link
NEW YORK (
) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, disappointing return on equity and poor profit margins.
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Highlights from the ratings report include:
- AMOT's very impressive revenue growth greatly exceeded the industry average of 5.4%. Since the same quarter one year prior, revenues leaped by 140.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Powered by its strong earnings growth of 118.18% and other important driving factors, this stock has surged by 93.32% 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.
- ALLIED MOTION TECHNOLOGIES reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, ALLIED MOTION TECHNOLOGIES reported lower earnings of $0.44 versus $0.63 in the prior year.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Electrical Equipment industry and the overall market, ALLIED MOTION TECHNOLOGIES's return on equity is below that of both the industry average and the S&P 500.
- The gross profit margin for ALLIED MOTION TECHNOLOGIES is currently lower than what is desirable, coming in at 29.95%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 3.55% trails that of the industry average.
Allied Motion Technologies Inc. designs, manufactures, and sells motors, electronic motion controls, gearing, and optical encoder products worldwide. Allied Motion has a market cap of $123.1 million and is part of the industrial goods sector and industrial industry. Shares are up 7% year to date as of the close of trading on Friday.
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