NEW YORK (
-- CGG Veritas
) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.
Highlights from the ratings report include:
- CGG VERITAS reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, CGG VERITAS continued to lose money by earning -$0.47 versus -$2.51 in the prior year. This year, the market expects an improvement in earnings ($0.15 versus -$0.47).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Energy Equipment & Services industry. The net income increased by 221.2% when compared to the same quarter one year prior, rising from -$35.00 million to $42.41 million.
- Net operating cash flow has remained constant at $82.41 million with no significant change when compared to the same quarter last year. Even though CGG VERITAS's cash flow growth was minimal, the firm managed to surpass its industry's average growth rate of -76.72%.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Energy Equipment & Services industry and the overall market, CGG VERITAS's return on equity significantly trails that of both the industry average and the S&P 500.
- In its most recent trading session, CGV 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. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
Compagnie Generale de Geophysique-Veritas S.A., together with its subsidiaries, provides geophysical services and equipment to the oil and gas exploration and production industries in France and internationally. The company has a P/E ratio of 262.8, above the S&P 500 P/E ratio of 17.7. CGG Veritas has a market cap of $3.99 billion and is part of the
industry. Shares are up 19.6% year to date as of the close of trading on Thursday.
You can view the full
or get investment ideas from our