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, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including poor profit margins and a generally disappointing performance in the stock itself.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 13.8%. Since the same quarter one year prior, revenues rose by 26.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- GENERAL CABLE CORP/DE reported significant earnings per share improvement 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. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, GENERAL CABLE CORP/DE increased its bottom line by earning $1.30 versus $1.06 in the prior year. This year, the market expects an improvement in earnings ($3.00 versus $1.30).
- BGC's debt-to-equity ratio of 0.69 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.97 is weak.
- BGC has underperformed the S&P 500 Index, declining 18.82% from its price level of one year ago. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- The gross profit margin for GENERAL CABLE CORP/DE is currently extremely low, coming in at 13.20%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 2.50% trails that of the industry average.
General Cable Corporation provides copper, aluminum, and fiber optic wire and cable products worldwide. The company has a P/E ratio of 9.7, equal to the average industrial industry P/E ratio and below the S&P 500 P/E ratio of 17.7. General Cable has a market cap of $1.2 billion and is part of the
industry. Shares are down 40.5% year to date as of the close of trading on Friday.
You can view the full
or get investment ideas from our