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 deteriorating net income, disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.
Highlights from the ratings report include:
- 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 Media industry. The net income has significantly decreased by 102.9% when compared to the same quarter one year ago, falling from $53.87 million to -$1.58 million.
- 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. Compared to other companies in the Media industry and the overall market, INSIGNIA SYSTEMS INC's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for INSIGNIA SYSTEMS INC is rather low; currently it is at 22.50%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -39.50% is significantly below that of the industry average.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 62.95%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 103.78% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- INSIGNIA SYSTEMS INC 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. This company has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, INSIGNIA SYSTEMS INC increased its bottom line by earning $2.99 versus $0.38 in the prior year.
Insignia Systems, Inc. markets in-store advertising products, programs, and services to consumer packaged goods manufacturers and retailers in the United States and internationally. The company has a P/E ratio of 0.5, equal to the average media industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Insignia Systems has a market cap of $23.7 million and is part of the
industry. Shares are down 13.4% year to date as of the close of trading on Friday.
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-- Written by a member of TheStreet Ratings Staff