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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, reasonable valuation levels and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, disappointing return on equity and poor profit margins.
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Highlights from the ratings report include:
- POWL's debt-to-equity ratio is very low at 0.01 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- POWL, with its decline in revenue, slightly underperformed the industry average of 7.4%. Since the same quarter one year prior, revenues fell by 16.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- 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. When compared to other companies in the Electrical Equipment industry and the overall market, POWELL INDUSTRIES INC's return on equity is below that of both the industry average and the S&P 500.
- The gross profit margin for POWELL INDUSTRIES INC is rather low; currently it is at 21.45%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.95% trails that of the industry average.
Powell Industries, Inc. engineers packaged solutions and systems for the control, distribution, and management of electrical energy and other critical processes worldwide. Powell has a market cap of $638.3 million and is part of the industrial goods sector and industrial industry. Shares are down 22.1% year to date as of the close of trading on Wednesday.
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