Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.
Trade-Ideas LLC identified
) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Sonus Networks as such a stock due to the following factors:
- SONS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $12.6 million.
- SONS has traded 73,712 shares today.
- SONS is down 3.6% today.
- SONS was up 17.9% yesterday.
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More details on SONS:
Sonus Networks, Inc. provides networked solutions for communications service providers and enterprises. Currently there are 2 analysts that rate Sonus Networks a buy, no analysts rate it a sell, and 6 rate it a hold.
The average volume for Sonus Networks has been 976,100 shares per day over the past 30 days. Sonus has a market cap of $339.7 million and is part of the technology sector and telecommunications industry. The stock has a beta of 2.62 and a short float of 11% with 2.90 days to cover. Shares are down 59.2% year-to-date as of the close of trading on Thursday.
rates Sonus Networks as a
. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity and generally disappointing historical performance in the stock itself.
Highlights from the ratings report include:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Communications Equipment industry. The net income has significantly decreased by 179.1% when compared to the same quarter one year ago, falling from -$5.50 million to -$15.34 million.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Communications Equipment industry and the overall market, SONUS NETWORKS INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 65.65%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 210.00% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- SONS, with its decline in revenue, underperformed when compared the industry average of 10.7%. Since the same quarter one year prior, revenues fell by 27.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- SONUS NETWORKS INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. 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, SONUS NETWORKS INC continued to lose money by earning -$0.30 versus -$0.40 in the prior year. This year, the market expects an improvement in earnings (-$0.14 versus -$0.30).
- You can view the full Sonus Networks Ratings Report.