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NEW YORK (TheStreet) -- Magal Security Systems (MAGS) - Get Report has been downgraded by TheStreet Ratings from Buy to Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate MAGAL SECURITY SYSTEMS (MAGS) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we find that the company's return on equity has been disappointing."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- MAGS's very impressive revenue growth greatly exceeded the industry average of 0.3%. Since the same quarter one year prior, revenues leaped by 67.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- MAGS's debt-to-equity ratio is very low at 0.13 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, MAGS has a quick ratio of 2.33, which demonstrates the ability of the company to cover short-term liquidity needs.
- MAGAL SECURITY SYSTEMS reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, MAGAL SECURITY SYSTEMS swung to a loss, reporting -$0.28 versus $0.25 in the prior year.
- 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 Electronic Equipment, Instruments & Components industry and the overall market, MAGAL SECURITY SYSTEMS's return on equity significantly trails that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: MAGS Ratings Report
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