NEW YORK (
) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself, feeble growth in its earnings per share, deteriorating net income, generally weak debt management and disappointing return on equity.
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Highlights from the ratings report include:
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 67.92%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 278.57% compared to the year-earlier 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.
- GREEN PLAINS RENEWABLE ENRGY has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, GREEN PLAINS RENEWABLE ENRGY reported lower earnings of $1.02 versus $1.52 in the prior year. For the next year, the market is expecting a contraction of 134.8% in earnings (-$0.36 versus $1.02).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 251.6% when compared to the same quarter one year ago, falling from $4.98 million to -$7.55 million.
- The debt-to-equity ratio of 1.47 is relatively high when compared with the industry average, suggesting a need for better debt level management.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, GREEN PLAINS RENEWABLE ENRGY's return on equity significantly trails that of both the industry average and the S&P 500.
Green Plains Renewable Energy, Inc. engages in the production, marketing, and distribution of ethanol, distillers grains, and corn oil in the United States. The company has a P/E ratio of 9.9, equal to the average chemicals industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Green Plains Renewable Energy has a market cap of $122.8 million and is part of the
industry. Shares are down 63% year to date as of the close of trading on Friday.
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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.