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 notable return on equity. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.
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Highlights from the ratings report include:
- GORO's very impressive revenue growth greatly exceeded the industry average of 1.8%. Since the same quarter one year prior, revenues leaped by 260.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- GORO 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 2.86, which clearly demonstrates the ability to cover short-term cash needs.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Metals & Mining industry. The net income increased by 693.0% when compared to the same quarter one year prior, rising from $2.03 million to $16.12 million.
- GORO's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 28.04%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
Gold Resource Corporation, an exploration stage company, engages in the exploration for and production of gold and silver in Mexico. It also explores copper, lead, and zinc ores. The company has a P/E ratio of 13.7, below the average metals & mining industry P/E ratio of 13.9 and below the S&P 500 P/E ratio of 17.7. Gold Resource has a market cap of $948.7 million and is part of the
industry. Shares are down 15.1% year to date as of the close of trading on Monday.
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-- 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.