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 impressive record of earnings per share growth. 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:
- The revenue growth greatly exceeded the industry average of 18.5%. Since the same quarter one year prior, revenues rose by 12.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The current debt-to-equity ratio, 0.35, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, ICFI has a quick ratio of 1.68, which demonstrates the ability of the company to cover short-term liquidity needs.
- 38.30% is the gross profit margin for ICF INTERNATIONAL INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 4.30% trails the industry average.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Professional Services industry and the overall market, ICF INTERNATIONAL INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- ICFI has underperformed the S&P 500 Index, declining 10.59% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
ICF International Inc. provides management, technology, and policy professional services to government, commercial, and international clients. The company has a P/E ratio of 10, equal to the average diversified services industry P/E ratio and below the S&P 500 P/E ratio of 17.7. ICF International has a market cap of $368.3 million and is part of the services sector and diversified services industry. Shares are down 23.6% 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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