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NEW YORK (TheStreet) -- Whitestone REIT (WSR) - Get Report has been downgraded by TheStreet Ratings from Buy to Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate WHITESTONE REIT (WSR) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including poor profit margins and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- WSR's revenue growth has slightly outpaced the industry average of 10.0%. Since the same quarter one year prior, revenues rose by 11.7%. 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.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income increased by 126.6% when compared to the same quarter one year prior, rising from $1.26 million to $2.86 million.
- WHITESTONE REIT's earnings per share declined by 50.0% in the most recent quarter compared to 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, WHITESTONE REIT increased its bottom line by earning $0.24 versus $0.21 in the prior year. This year, the market expects an improvement in earnings ($0.31 versus $0.24).
- The gross profit margin for WHITESTONE REIT is rather low; currently it is at 20.91%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 14.86% significantly trails the industry average.
- Net operating cash flow has decreased to $5.77 million or 36.95% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- You can view the full analysis from the report here: WSR Ratings Report