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 attractive valuation levels and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.
Highlights from the ratings report include:
- Although EBF's debt-to-equity ratio of 0.14 is very low, it is currently higher than that of the industry average. Despite the fact that EBF's debt-to-equity ratio is low, the quick ratio, which is currently 0.69, displays a potential problem in covering short-term cash needs.
- EBF, with its decline in revenue, slightly underperformed the industry average of 0.2%. Since the same quarter one year prior, revenues slightly dropped by 8.8%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- 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. When compared to other companies in the Commercial Services & Supplies industry and the overall market, ENNIS INC's return on equity is below that of both the industry average and the S&P 500.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Commercial Services & Supplies industry. The net income has decreased by 19.9% when compared to the same quarter one year ago, dropping from $12.13 million to $9.71 million.
Ennis, Inc., together with its subsidiaries, engages in production and sale of business forms, other business products, and apparel. The company operates in two segments, Print and Apparel. The Print segment designs, manufactures, and sells business forms and other printed business products. The company has a P/E ratio of 8.7, equal to the average consumer non-durables industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Ennis has a market cap of $376.2 million and is part of the
industry. Shares are down 17.2% year to date as of the close of trading on Tuesday.
You can view the full
or get investment ideas from our