Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link
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 revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, poor profit margins and weak operating cash flow.
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Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 15.1%. Since the same quarter one year prior, revenues slightly increased by 4.9%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- MASTEC INC's earnings per share declined by 17.4% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, MASTEC INC increased its bottom line by earning $1.74 versus $1.43 in the prior year. This year, the market expects an improvement in earnings ($1.92 versus $1.74).
- MTZ's debt-to-equity ratio of 0.87 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.47 is sturdy.
- The gross profit margin for MASTEC INC is currently extremely low, coming in at 12.76%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.66% trails that of the industry average.
- Net operating cash flow has significantly decreased to -$20.39 million or 164.09% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
MasTec, Inc., an infrastructure construction company, provides engineering, building, installation, maintenance, and upgrade services for energy, utility, and communications infrastructure primarily in the United States. MasTec has a market cap of $2.15 billion and is part of the industrial goods sector and materials & construction industry. Shares are down 16.6% year to date as of the close of trading on Thursday.
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