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 downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.
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Highlights from the ratings report include:
- GLPW's revenue growth has slightly outpaced the industry average of 6.5%. Since the same quarter one year prior, revenues rose by 11.7%. 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.
- GLPW 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. Along with this, the company maintains a quick ratio of 2.59, which clearly demonstrates the ability to cover short-term cash needs.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. In comparison to the other companies in the Electrical Equipment industry and the overall market, GLOBAL POWER EQUIPMENT GROUP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- The gross profit margin for GLOBAL POWER EQUIPMENT GROUP is currently extremely low, coming in at 14.00%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -1.06% trails that of the industry average.
Global Power Equipment Group Inc. provides power generation equipment, and modification and maintenance services for energy, power infrastructure, and service industries. The company has a P/E ratio of 18.5, above the S&P 500 P/E ratio of 17.7. Global Power Equipment Group has a market cap of $283.3 million and is part of the industrial goods sector and industrial industry. Shares are down 2.9% 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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