Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B- . The company's strengths can be seen in multiple areas, such as its expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
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Highlights from the ratings report include:
- The gross profit margin for AMERICA MOVIL SA DE CV is rather high; currently it is at 56.00%. Regardless of AMX'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 6.40% trails the industry average.
- AMERICA MOVIL SA DE CV 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. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, AMERICA MOVIL SA DE CV reported lower earnings of $1.51 versus $1.90 in the prior year. This year, the market expects an improvement in earnings ($2.00 versus $1.51).
- AMX, with its decline in revenue, underperformed when compared the industry average of 0.2%. Since the same quarter one year prior, revenues fell by 10.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- 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. When compared to other companies in the Wireless Telecommunication Services industry and the overall market, AMERICA MOVIL SA DE CV's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
- In its most recent trading session, AMX has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
America Movil, S.A.B. de C.V. provides telecommunications services primarily in the United States, Latin America, and the Caribbean. The company offers mobile and fixed voice services, including airtime, local, long-distance, public telephony, and network interconnection services. The company has a P/E ratio of 13.9, below the average telecommunications industry P/E ratio of 17.3 and below the S&P 500 P/E ratio of 17.7. America Movil S.A.B. de C.V has a market cap of $100.36 billion and is part of the
industry. Shares are up 12.8% year to date as of the close of trading on Friday.
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--Written by a member of TheStreet Ratings Staff.