Editor's Note: 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.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B. The company's strengths can be seen in multiple areas, such as its solid stock price performance, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.
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Highlights from the ratings report include:
- Compared to its closing price of one year ago, GDI's share price has jumped by 31.95%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, GDI should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- 36.80% is the gross profit margin for GARDNER DENVER INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 8.89% is above that of the industry average.
- GDI's debt-to-equity ratio is very low at 0.22 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.92 is somewhat weak and could be cause for future problems.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 20.3%. Since the same quarter one year prior, revenues fell by 15.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The change in net income from the same quarter one year ago has significantly exceeded that of the Machinery industry average, but is less than that of the S&P 500. The net income has decreased by 16.7% when compared to the same quarter one year ago, dropping from $54.83 million to $45.68 million.
Gardner Denver, Inc. designs, manufactures, and markets engineered industrial machinery and related parts and services primarily in North America, Europe, Asia, South America, Africa, and Australia. The company operates in two segments, Industrial Products Group and Engineered Products Group. Gardner Denver has a market cap of $3.7 billion and is part of the industrial goods sector and industrial industry. The company has a P/E ratio of 15.00, below the S&P 500 P/E ratio of 18.00. Shares are up 9.9% year to date as of the close of trading on Thursday.
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--Written by a member of TheStreet Ratings Staff.
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