NEW YORK (
-- Duff & Phelps Corporation
) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and unimpressive growth in net income.
Highlights from the ratings report include:
- Net operating cash flow has significantly decreased to -$22.32 million or 243.78% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- The change in net income from the same quarter one year ago has exceeded that of the Capital Markets industry average, but is less than that of the S&P 500. The net income has decreased by 3.7% when compared to the same quarter one year ago, dropping from $4.27 million to $4.11 million.
- DUFF & PHELPS CORP's earnings per share declined by 12.5% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, DUFF & PHELPS CORP increased its bottom line by earning $0.60 versus $0.52 in the prior year. This year, the market expects an improvement in earnings ($0.86 versus $0.60).
- 42.20% is the gross profit margin for DUFF & PHELPS CORP which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, DUF's net profit margin of 4.70% significantly trails the industry average.
- DUF has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 6.15, which clearly demonstrates the ability to cover short-term cash needs.
Duff & Phelps Corporation, through its subsidiaries, provides independent financial advisory and investment banking services worldwide. It operates in three segments: Financial Advisory, Corporate Finance Consulting, and Investment Banking. The company has a P/E ratio of 22.2, equal to the average financial services industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Duff & Phelps has a market cap of $405.1 million and is part of the
industry. Shares are down 22% year to date as of the close of trading on Friday.
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