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 (

TheStreet

)

-- Audience

(Nasdaq:

ADNC

) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, unimpressive growth in net income, weak operating cash flow and generally disappointing historical performance in the stock itself.

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Highlights from the ratings report include:

  • AUDIENCE INC's earnings per share declined by 50.0% in the most recent quarter compared to the same quarter a year ago. For the next year, the market is expecting a contraction of 54.0% in earnings ($0.34 versus $0.74).
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Electronic Equipment, Instruments & Components industry. The net income has significantly decreased by 38.3% when compared to the same quarter one year ago, falling from $4.33 million to $2.67 million.
  • Net operating cash flow has decreased to $3.82 million or 29.25% 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.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 43.92%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 50.00% compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • The gross profit margin for AUDIENCE INC is rather high; currently it is at 60.72%. Regardless of ADNC'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 5.88% trails the industry average.

Audience, Inc. provides intelligent voice and audio solutions for mobile devices worldwide. The company's platform consists of proprietary, purpose-built digital signal processors, analog and mixed signal circuits, and algorithms for voice isolation and noise suppression. Audience has a market cap of $226.2 million and is part of the technology sector and electronics industry. Shares are up 1.6% year to date as of the close of trading on Wednesday.

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Audience Ratings Report

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