NEW YORK (
-- Lacrosse Footwear
) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.
Highlights from the ratings report include:
- Net operating cash flow has significantly decreased to -$8.87 million or 195.69% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- 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. In comparison to the other companies in the Textiles, Apparel & Luxury Goods industry and the overall market, LACROSSE FOOTWEAR INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- BOOT's debt-to-equity ratio is very low at 0.10 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.81 is somewhat weak and could be cause for future problems.
- 44.90% is the gross profit margin for LACROSSE FOOTWEAR 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 -2.60% is in-line with the industry average.
LaCrosse Footwear, Inc., through its subsidiaries, engages in the design, development, manufacture, and marketing of footwear and apparel for the work and outdoor markets. The company has a P/E ratio of 24.7, above the average consumer non-durables industry P/E ratio of 16.4 and above the S&P 500 P/E ratio of 16.7. Lacrosse has a market cap of $110.6 million and is part of the
industry. Shares are up 3.5% year to date as of the close of trading on Monday.
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