NEW YORK (TheStreet) -- Shares of LightPath Technologies (LPTH) - Get Report were gaining 43.6% to $1.58 Wednesday after the company provided an update on its new infrared product line.

LightPath said its IR shipment volumes tripled in the fiscal third quarter with revenue increasing 193% in the quarter.

"The launch of our proprietary infrared product technologies positions us to participate in an estimated $3.5 billion global market, according to market research expert Techno Systems Research," President and CEO Jim Gaynor said in a statement. Gaynor continued, saying the company's technology "brings to market a lower-cost high-value product that promotes the commercial development of infrared imaging technology."

The company said its IR products were developers in cooperation with customers and OEMs, which led to "recurring production levels exceeding $1.5 million per year, or more than 10% of the company's consolidated annualized revenues."

About 2.7 million shares of LightPath Technologies were traded by 11:33 a.m. Wednesday, above the company's average trading volume of about 30,000 shares a day.

TheStreet Ratings team rates LIGHTPATH TECHNOLOGIES INC as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:

"We rate LIGHTPATH TECHNOLOGIES INC (LPTH) a SELL. This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its weak operating cash flow and generally disappointing historical performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Net operating cash flow has significantly decreased to -$0.26 million or 386.66% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • LPTH's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 35.42%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, LIGHTPATH TECHNOLOGIES INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • LIGHTPATH TECHNOLOGIES INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, LIGHTPATH TECHNOLOGIES INC swung to a loss, reporting -$0.02 versus $0.02 in the prior year. This year, the market expects earnings to be in line with last year (-$0.02 versus -$0.02).
  • The gross profit margin for LIGHTPATH TECHNOLOGIES INC is rather high; currently it is at 53.70%. 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 2.81% trails the industry average.
  • You can view the full analysis from the report here: LPTH Ratings Report