NEW YORK (
-- Renesola Limited American Deposit Receipt R
) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity and attractive valuation levels. However, as a counter to these strengths, we find that the company has not been very careful in the management of its balance sheet.
Highlights from the ratings report include:
- The debt-to-equity ratio of 1.13 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, SOL maintains a poor quick ratio of 0.81, which illustrates the inability to avoid short-term cash problems.
- 36.60% is the gross profit margin for RENESOLA LTD which we consider to be strong. It has increased significantly from the same period last year. Despite the strong results of the gross profit margin, SOL's net profit margin of 13.20% significantly trails the industry average.
- Powered by its strong earnings growth of 250.00% and other important driving factors, this stock has surged by 28.29% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- SOL's very impressive revenue growth greatly exceeded the industry average of 5.7%. Since the same quarter one year prior, revenues leaped by 58.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
Renesola Ltd., together with its subsidiaries, engages in the manufacture and sale of solar wafers and solar power products. It offers virgin polysilicons, monocrystalline and multicrystalline solar wafers, and photovoltaic cells and modules. The company has a P/E ratio of 4.6, equal to the average electronics industry P/E ratio and below the S&P 500 P/E ratio of 17. Renesola Limited American Deposit Receipt R has a market cap of $772.6 million and is part of the
industry. Shares are down 0.9% year to date as of the close of trading on Thursday.
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