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NEW YORK (TheStreet) -- Ultrapetrol Bahamas (ULTR) - Get Report has been downgraded by TheStreet Ratings from Hold to Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
"We rate ULTRAPETROL BAHAMAS LTD (ULTR) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, generally high debt management risk and generally disappointing historical performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- 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 Marine industry. The net income has significantly decreased by 308.5% when compared to the same quarter one year ago, falling from $7.00 million to -$14.59 million.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Marine industry and the overall market, ULTRAPETROL BAHAMAS LTD's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for ULTRAPETROL BAHAMAS LTD is rather low; currently it is at 24.30%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -14.68% is significantly below that of the industry average.
- The debt-to-equity ratio of 1.22 is relatively high when compared with the industry average, suggesting a need for better debt level management. Even though the debt-to-equity ratio is weak, ULTR's quick ratio is somewhat strong at 1.42, demonstrating the ability to handle short-term liquidity needs.
- The share price of ULTRAPETROL BAHAMAS LTD has not done very well: it is down 21.87% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
- You can view the full analysis from the report here: ULTR Ratings Report