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NEW YORK (TheStreet) -- Gulfmark Offshore (GLF) 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 GULFMARK OFFSHORE INC (GLF) 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 impressive record of earnings per share growth, compelling growth in net income and robust revenue growth. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- GULFMARK OFFSHORE INC has improved earnings per share by 42.1% 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 two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, GULFMARK OFFSHORE INC increased its bottom line by earning $2.69 versus $0.72 in the prior year. This year, the market expects an improvement in earnings ($3.17 versus $2.69).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Energy Equipment & Services industry. The net income increased by 44.1% when compared to the same quarter one year prior, rising from $9.86 million to $14.20 million.
- Despite currently having a low debt-to-equity ratio of 0.50, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that GLF's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.29 is high and demonstrates strong liquidity.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to the other companies in the Energy Equipment & Services industry and the overall market, GULFMARK OFFSHORE INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- GLF'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 41.83%, 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. 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.
- You can view the full analysis from the report here: GLF Ratings Report