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 compelling growth in net income, robust revenue growth and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including poor profit margins and generally poor debt management.
Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Machinery industry. The net income increased by 132.9% when compared to the same quarter one year prior, rising from $5.69 million to $13.25 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 28.0%. Since the same quarter one year prior, revenues rose by 22.2%. 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.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
- The debt-to-equity ratio is very high at 2.70 and currently higher than the industry average, implying that there is very poor management of debt levels within the company. Even though the debt-to-equity ratio is weak, TRS's quick ratio is somewhat strong at 1.00, demonstrating the ability to handle short-term liquidity needs.
- The gross profit margin for TRIMAS CORP is currently lower than what is desirable, coming in at 31.80%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 5.10% trails that of the industry average.
TriMas Corporation designs, manufactures, and distributes various products for commercial, industrial, and consumer markets worldwide. The company has a P/E ratio of 15.7, above the average industrial industry P/E ratio of 13.1 and below the S&P 500 P/E ratio of 17.7. TriMas has a market cap of $685 million and is part of the
industry. Shares are up 25.6% year to date as of the close of trading on Thursday.
You can view the full
or get investment ideas from our
-- Written by a member of TheStreet Ratings Staff