Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model
NEW YORK (
-- Rocky Brands
) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share and increase in net income. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and weak operating cash flow.
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Highlights from the ratings report include:
- Compared to where it was 12 months ago, this stock has enjoyed a nice rise of 25.06% which was in line with the performance of the S&P 500 Index. 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.
- ROCKY BRANDS INC has improved earnings per share by 20.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, ROCKY BRANDS INC increased its bottom line by earning $1.19 versus $1.11 in the prior year. This year, the market expects an improvement in earnings ($1.40 versus $1.19).
- 37.60% is the gross profit margin for ROCKY BRANDS INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 1.66% trails the industry average.
- Net operating cash flow has significantly decreased to $2.99 million or 79.06% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- 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. In comparison to the other companies in the Textiles, Apparel & Luxury Goods industry and the overall market, ROCKY BRANDS INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
Rocky Brands, Inc., together with its subsidiaries, designs, manufactures, and markets footwear and apparel under the Rocky, Georgia Boot, Durango, Lehigh, Mossy Oak, and Michelin brand names. The company has a P/E ratio of 12.8, below the S&P 500 P/E ratio of 17.7. Rocky has a market cap of $115.9 million and is part of the consumer goods sector and consumer non-durables industry. Shares are up 18.3% year to date as of the close of trading on Friday.
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-- Written by a member of TheStreet Ratings Staff
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