NEW YORK (
) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and feeble growth in the company's earnings per share.
Highlights from the ratings report include:
- Compared to its closing price of one year ago, CONN's share price has jumped by 203.30%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- Net operating cash flow has significantly increased by 757.69% to $34.75 million when compared to the same quarter last year. In addition, CONN'S INC has also vastly surpassed the industry average cash flow growth rate of 11.67%.
- CONN's debt-to-equity ratio of 0.83 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 3.38 is very high and demonstrates very strong liquidity.
- 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 Specialty Retail industry. The net income has significantly decreased by 313.6% when compared to the same quarter one year ago, falling from $1.61 million to -$3.43 million.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Specialty Retail industry and the overall market, CONN'S INC's return on equity significantly trails that of both the industry average and the S&P 500.
Conn's, Inc. operates as a specialty retailer of home appliances, consumer electronics, home office equipment, lawn and garden products, mattresses, and furniture in the United States. Conn's has a market cap of $340.1 million and is part of the
industry. Shares are up 115.8% year to date as of the close of trading on Monday.
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