NEW YORK (
-- Loral Space & Communications
) 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, solid stock price performance and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and poor profit margins.
Highlights from the ratings report include:
- Net operating cash flow has decreased to $3.58 million or 44.39% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, LORAL SPACE & COMMUNICATIONS has marginally lower results.
- The gross profit margin for LORAL SPACE & COMMUNICATIONS is rather low; currently it is at 17.80%. It has decreased from the same quarter the previous year. Despite the weak results of the gross profit margin, the net profit margin of 123.90% has significantly outperformed against the industry average.
- LORL has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.80 is somewhat weak and could be cause for future problems.
- Powered by its strong earnings growth of 553.29% and other important driving factors, this stock has surged by 104.71% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- The revenue growth came in higher than the industry average of 0.3%. Since the same quarter one year prior, revenues rose by 25.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
Loral Space & Communications Inc., together with its subsidiaries, operates as a satellite communications company. Loral Space has a market cap of $1.5 billion and is part of the
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