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 revenue growth, increase in net income and expanding profit margins. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.
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Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 7.8%. Since the same quarter one year prior, revenues slightly increased by 8.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Health Care Equipment & Supplies industry average. The net income increased by 8.9% when compared to the same quarter one year prior, going from $0.58 million to $0.64 million.
- SPECTRANETICS CORP reported flat earnings per share in the most recent quarter. 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, SPECTRANETICS CORP turned its bottom line around by earning $0.03 versus -$0.39 in the prior year. This year, the market expects an improvement in earnings ($0.07 versus $0.03).
- Compared to its closing price of one year ago, SPNC's share price has jumped by 82.77%, exceeding the performance of the broader market during that same time frame. Looking ahead, however, we cannot assume that the stock's past performance is going to drive future results. Quite to the contrary, its sharp appreciation over the last year is one of the factors that should prompt investors to seek better opportunities elsewhere.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Health Care Equipment & Supplies industry and the overall market, SPECTRANETICS CORP's return on equity significantly trails that of both the industry average and the S&P 500.
The Spectranetics Corporation, together with its Subsidiaries, develops, manufactures, markets, and distributes single-use medical devices used in minimally invasive procedures in the cardiovascular system. The company has a P/E ratio of 299.5, below the average health services industry P/E ratio of 399.3 and above the S&P 500 P/E ratio of 17.7. Spectranetics has a market cap of $410.8 million and is part of the
industry. Shares are up 66.1% year to date as of the close of trading on Monday.
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-- Written by a member of TheStreet Ratings Staff
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.