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NEW YORK (TheStreet) -- Gibraltar Industries (ROCK) has been downgraded by TheStreet Ratings from Buy to Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate GIBRALTAR INDUSTRIES INC (ROCK) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth 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 poor profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- ROCK's revenue growth has slightly outpaced the industry average of 2.4%. Since the same quarter one year prior, revenues slightly increased by 7.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The current debt-to-equity ratio, 0.55, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, ROCK has a quick ratio of 1.58, which demonstrates the ability of the company to cover short-term liquidity needs.
- GIBRALTAR INDUSTRIES INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, GIBRALTAR INDUSTRIES INC reported poor results of -$2.63 versus -$0.18 in the prior year. This year, the market expects an improvement in earnings ($0.71 versus -$2.63).
- The gross profit margin for GIBRALTAR INDUSTRIES INC is rather low; currently it is at 17.06%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -47.38% is significantly below that of the industry average.
- Net operating cash flow has decreased to $14.40 million or 35.69% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- You can view the full analysis from the report here: ROCK Ratings Report