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 impressive record of earnings per share growth. 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:
- CW's revenue growth has slightly outpaced the industry average of 2.7%. Since the same quarter one year prior, revenues rose by 11.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The current debt-to-equity ratio, 0.37, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.35, which illustrates the ability to avoid short-term cash problems.
- 37.00% is the gross profit margin for CURTISS-WRIGHT CORP which we consider to be strong. Regardless of CW'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 6.20% trails the industry average.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Aerospace & Defense industry and the overall market, CURTISS-WRIGHT CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- CW has underperformed the S&P 500 Index, declining 6.88% from its price level of one year ago. 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.
Curtiss-Wright Corporation, together with its subsidiaries, designs, manufactures, and overhauls precision components and systems. It operates in three segments: Flow Control, Motion Control, and Metal Treatment. The company has a P/E ratio of 10.9, equal to the average aerospace/defense industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Curtiss-Wright has a market cap of $1.3 billion and is part of the
industry. Shares are down 18.4% year to date as of the close of trading on Friday.
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