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 robust 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 also find weaknesses including weak operating cash flow and poor profit margins.
- ACTIVE STOCK TRADERS: Check out TheStreet's special offer for Real Money, headlined by Jim Cramer, now!
Highlights from the ratings report include:
- RAIL's very impressive revenue growth greatly exceeded the industry average of 8.9%. Since the same quarter one year prior, revenues leaped by 85.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
- RAIL 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. To add to this, RAIL has a quick ratio of 1.60, which demonstrates the ability of the company to cover short-term liquidity needs.
- The gross profit margin for FREIGHTCAR AMERICA INC is currently extremely low, coming in at 10.60%. Regardless of RAIL's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 3.10% trails the industry average.
- Net operating cash flow has significantly decreased to -$17.55 million or 200.94% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
FreightCar America, Inc., through its subsidiaries, designs, manufactures, and sells railroad freight cars primarily for railroads, shippers, and financial institutions in North America. The company has a P/E ratio of 15.8, equal to the average transportation industry P/E ratio and below the S&P 500 P/E ratio of 17.7. FreightCar America has a market cap of $251 million and is part of the
industry. Shares are up 0.1% year to date as of the close of trading on Tuesday.
You can view the full
or get investment ideas from our
-- 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.