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 robust revenue growth, reasonable valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, generally poor debt management and poor profit margins.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 6.2%. Since the same quarter one year prior, revenues rose by 21.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- This stock has managed to rise its share value by 119.36% over the past twelve months. Although SUSS had significant growth over the past year, our hold rating indicates that we do not recommend additional investment in this stock at the current time.
- The debt-to-equity ratio of 1.35 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, SUSS maintains a poor quick ratio of 0.95, which illustrates the inability to avoid short-term cash problems.
- The gross profit margin for SUSSER HOLDINGS CORP is currently extremely low, coming in at 5.30%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.00% trails that of the industry average.
Susser Holdings Corporation, together with its subsidiaries, operates convenience stores in Texas, New Mexico, and Oklahoma. The company operates in two segments, Retail and Wholesale. The company has a P/E ratio of 10.6, equal to the average retail industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Susser has a market cap of $593.4 million and is part of the
industry. Shares are up 30.7% year to date as of the close of trading on Thursday.
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-- Written by a member of TheStreet Ratings Staff