NEW YORK (
) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.
Highlights from the ratings report include:
- AOSL's debt-to-equity ratio is very low at 0.04 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, AOSL has a quick ratio of 2.15, which demonstrates the ability of the company to cover short-term liquidity needs.
- ALPHA AND OMEGA SEMICONDUCTR has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from 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, ALPHA AND OMEGA SEMICONDUCTR increased its bottom line by earning $1.47 versus $0.83 in the prior year.
- The gross profit margin for ALPHA AND OMEGA SEMICONDUCTR is currently lower than what is desirable, coming in at 30.00%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.80% significantly trails the industry average.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. In comparison to the other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, ALPHA AND OMEGA SEMICONDUCTR's return on equity is significantly below that of the industry average and is below that of the S&P 500.
Alpha and Omega Semiconductor Limited designs, develops, and supplies a range of power semiconductors worldwide. The company has a P/E ratio of 12.9, above the average electronics industry P/E ratio of 6.7 and below the S&P 500 P/E ratio of 17.7. Alpha & Omega Semiconductor has a market cap of $198.5 million and is part of the
industry. Shares are up 45.8% year to date as of the close of trading on Friday.
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-- Written by a member of TheStreet RatingsStaff