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 downgraded by TheStreet Ratings from buy 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 notable return on equity. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and weak operating cash flow.
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Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 19.1%. Since the same quarter one year prior, revenues slightly increased by 3.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- AZK has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 6.49, which clearly demonstrates the ability to cover short-term cash needs.
- The gross profit margin for AURIZON MINES LTD is rather high; currently it is at 58.10%. Regardless of AZK'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 14.10% trails the industry average.
- Net operating cash flow has declined marginally to $21.72 million or 5.80% when compared to the same quarter last year. Despite a decrease in cash flow AURIZON MINES LTD is still fairing well by exceeding its industry average cash flow growth rate of -30.32%.
- AZK has underperformed the S&P 500 Index, declining 20.39% from its price level of one year ago. 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.
Aurizon Mines Ltd. engages in the acquisition, exploration, development, and production of gold properties in North America. The company's principal properties include the Casa Berardi gold mine and the Joanna gold project both located in the Abitibi region of northwestern Quebec. The company has a P/E ratio of 14.5, below the average metals & mining industry P/E ratio of 14.7 and below the S&P 500 P/E ratio of 17.7. Aurizon Mines has a market cap of $742 million and is part of the basic materials sector and metals & mining industry. Shares are down 8.5% year to date as of the close of trading on Friday.
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-- Written by a member of TheStreet Ratings Staff
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