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NEW YORK (TheStreet) -- Constellium (CSTM) - Get Constellium SE Class A Report has been downgraded by TheStreet Ratings from Hold to Sell with a ratings score of D.  TheStreet Ratings Team has this to say about their recommendation:

"We rate CONSTELLIUM NV (CSTM) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its poor profit margins and generally high debt management risk."

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Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The gross profit margin for CONSTELLIUM NV is rather low; currently it is at 15.33%. Regardless of CSTM's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, CSTM's net profit margin of 3.04% is significantly lower than the industry average.
  • The debt-to-equity ratio is very high at 11.15 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, CSTM's quick ratio is somewhat strong at 1.21, demonstrating the ability to handle short-term liquidity needs.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Metals & Mining industry average, but is greater than that of the S&P 500. The net income increased by 22.2% when compared to the same quarter one year prior, going from $31.17 million to $38.08 million.
  • CSTM has underperformed the S&P 500 Index, declining 8.04% from its price level of one year ago.
  • CONSTELLIUM NV has improved earnings per share by 20.0% in the most recent quarter compared to the same quarter a year ago. This year, the market expects an improvement in earnings ($1.30 versus $1.28).
  • You can view the full analysis from the report here: CSTM Ratings Report

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