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 or Stephanie Link
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, attractive valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.
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Highlights from the ratings report include:
- The revenue growth greatly exceeded the industry average of 17.8%. Since the same quarter one year prior, revenues rose by 29.2%. 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.
- 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. In comparison to the other companies in the Machinery industry and the overall market, TITAN INTERNATIONAL INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Machinery industry. The net income has significantly decreased by 47.3% when compared to the same quarter one year ago, falling from $44.06 million to $23.22 million.
Titan International, Inc., together with its subsidiaries, engages in the manufacture and sale of wheels, tires, and undercarriage systems and components for off-highway vehicles used in the agricultural, earthmoving/construction, and consumer markets in the United States and other countries. Titan International has a market cap of $790.8 million and is part of the consumer goods sector and consumer non-durables industry. Shares are down 32% year to date as of the close of trading on Wednesday.
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