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 and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally poor debt management and poor profit margins.
Highlights from the ratings report include:
- JBT's revenue growth trails the industry average of 15.9%. Since the same quarter one year prior, revenues slightly increased by 1.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Machinery industry and the overall market, JOHN BEAN TECHNOLOGIES's return on equity significantly exceeds that of both the industry average and the S&P 500.
- JOHN BEAN TECHNOLOGIES's earnings per share declined by 17.6% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, JOHN BEAN TECHNOLOGIES reported lower earnings of $1.06 versus $1.30 in the prior year. This year, the market expects an improvement in earnings ($1.42 versus $1.06).
- The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Machinery industry average. The net income has decreased by 20.4% when compared to the same quarter one year ago, dropping from $4.90 million to $3.90 million.
- Currently the debt-to-equity ratio of 1.65 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Along with the unfavorable debt-to-equity ratio, JBT maintains a poor quick ratio of 0.80, which illustrates the inability to avoid short-term cash problems.
John Bean Technologies Corporation provides technology solutions for the food processing and air transportation industries. The company operates in two segments, JBT FoodTech and JBT AeroTech. The company has a P/E ratio of 13.8, below the average industrial industry P/E ratio of 14.1 and below the S&P 500 P/E ratio of 17.7. John Bean has a market cap of $407.6 million and is part of the
industry. Shares are down 7% year to date as of the close of trading on Wednesday.
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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.