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 robust revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. However, as a counter to these strengths, we find that the growth in the company's earnings per share has not been good.
Highlights from the ratings report include:
- LEUCADIA NATIONAL CORP reported significant earnings per share improvement 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 year. During the past fiscal year, LEUCADIA NATIONAL CORP increased its bottom line by earning $7.63 versus $2.17 in the prior year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Diversified Financial Services industry. The net income increased by 179.2% when compared to the same quarter one year prior, rising from -$235.14 million to $186.31 million.
- The current debt-to-equity ratio, 0.31, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, LUK has a quick ratio of 1.64, which demonstrates the ability of the company to cover short-term liquidity needs.
- LUK's very impressive revenue growth greatly exceeded the industry average of 0.1%. Since the same quarter one year prior, revenues leaped by 162.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
Leucadia National Corporation engages in manufacturing, telecommunications, land based contract oil and gas drilling, property management and services, gaming entertainment, real estate activities, medical product development, and winery operations in the United States. The company has a P/E ratio of 12.6, above the average materials & construction industry P/E ratio of 4.6 and below the S&P 500 P/E ratio of 17.7. Leucadia has a market cap of $8 billion and is part of the
industry. Shares are up 3.2% year to date as of the close of trading on Friday.
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