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, 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 also find weaknesses including unimpressive growth in net income, poor profit margins and weak operating cash flow.
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Highlights from the ratings report include:
- Powered by its strong earnings growth of 35.00% and other important driving factors, this stock has surged by 194.59% over the past year, outperforming the rise in the S&P 500 Index during the same period. 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.
- Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.89 is weak.
- EMMIS COMMUNICATIONS CP has improved earnings per share by 35.0% 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 year. During the past fiscal year, EMMIS COMMUNICATIONS CP turned its bottom line around by earning $1.56 versus -$0.60 in the prior year.
- The gross profit margin for EMMIS COMMUNICATIONS CP is rather low; currently it is at 17.50%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -7.30% is significantly below that of the industry average.
- Net operating cash flow has significantly decreased to -$5.44 million or 326.43% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
Emmis Communications Corporation, a diversified media company, engages in radio broadcasting and magazine publishing operations primarily in the United States. It also owns and operates national radio networks in Slovakia and Bulgaria. The company has a P/E ratio of 3.9, below the average media industry P/E ratio of 5.1 and below the S&P 500 P/E ratio of 17.7. Emmis has a market cap of $75 million and is part of the
industry. Shares are up 230.3% year to date as of the close of trading on Thursday.
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-- Written by a member of TheStreet Ratings Staff
TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.