NEW YORK (
-- China GrenTech Corporation
) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow, a generally disappointing performance in the stock itself and poor profit margins.
Highlights from the ratings report include:
- Net operating cash flow has significantly decreased to $56.89 million or 71.40% 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.
- In its most recent trading session, GRRF 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.
- Despite currently having a low debt-to-equity ratio of 0.47, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.92 is weak.
- CHINA GRENTECH CORP LTD -ADR 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 two years. During the past fiscal year, CHINA GRENTECH CORP LTD -ADR increased its bottom line by earning $0.62 versus $0.20 in the prior year.
- GRRF's very impressive revenue growth greatly exceeded the industry average of 0.6%. Since the same quarter one year prior, revenues leaped by 66.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
China GrenTech Corporation Limited, together with its subsidiaries, engages in the manufacture and sale of wireless coverage products and services in the People's Republic of China. The company has a P/E ratio of 12.6, below the S&P 500 P/E ratio of 15.9. China GrenTech has a market cap of $74.1 million and is part of the
industry. Shares are up 3.8% year to date as of the close of trading on Wednesday.
You can view the full
or get investment ideas from our