NEW YORK (
-- PRGX Global
) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, 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 poor profit margins and a generally disappointing performance in the stock itself.
Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the IT Services industry. The net income increased by 1928.6% when compared to the same quarter one year prior, rising from $0.04 million to $0.71 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 12.8%. Since the same quarter one year prior, revenues rose by 11.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- PRGX GLOBAL INC has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. 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, PRGX GLOBAL INC reported lower earnings of $0.13 versus $0.64 in the prior year. This year, the market expects an improvement in earnings ($0.17 versus $0.13).
- This stock's share value has moved by only 17.83% over the past year. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
- The gross profit margin for PRGX GLOBAL INC is currently lower than what is desirable, coming in at 31.90%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.40% significantly trails the industry average.
PRGX Global, Inc., an analytics powered information and professional services company, together with its subsidiaries, provides recovery audit, healthcare claims recovery audit, and business analytics and advisory services. The company has a P/E ratio of 15.3, above the average diversified services industry P/E ratio of 14.8 and below the S&P 500 P/E ratio of 17.7. PRGX Global has a market cap of $119.9 million and is part of the
industry. Shares are down 27.2% year to date as of the close of trading on Friday.
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