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 largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, premium valuation and poor profit margins.
Highlights from the ratings report include:
- PZZI's debt-to-equity ratio is very low at 0.22 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.09, which illustrates the ability to avoid short-term cash problems.
- Net operating cash flow has significantly increased by 260.97% to $0.07 million when compared to the same quarter last year. In addition, PIZZA INN HOLDINGS INC has also vastly surpassed the industry average cash flow growth rate of 22.14%.
- PZZI, with its decline in revenue, slightly underperformed the industry average of 5.0%. Since the same quarter one year prior, revenues slightly dropped by 0.2%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- The gross profit margin for PIZZA INN HOLDINGS INC is currently extremely low, coming in at 13.70%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.50% trails that of the industry average.
Pizza Inn Holdings, Inc., together with its subsidiaries, operates and franchises pizza buffet, delivery/carry-out, and express restaurants under the Pizza Inn trademark in the United States and internationally. The company has a P/E ratio of 17.1, below the average leisure industry P/E ratio of 26.9 and below the S&P 500 P/E ratio of 17.7. Pizza Inn has a market cap of $43.1 million and is part of the
industry. Shares are up 64.1% year to date as of the close of trading on Monday.
You can view the full
or get investment ideas from our
-- Written by a member of TheStreet Ratings Staff