NEW YORK ( TheStreet) -- Triangle Capital Corp (NYSE: TCAP) 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, solid stock price performance and notable return on equity. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and feeble growth in the company's earnings per share. Highlights from the ratings report include:
- Net operating cash flow has significantly decreased to -$75.24 million or 3593.61% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- TRIANGLE CAPITAL CORP's earnings per share declined by 40.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, TRIANGLE CAPITAL CORP increased its bottom line by earning $1.99 versus $0.27 in the prior year. For the next year, the market is expecting a contraction of 16.1% in earnings ($1.67 versus $1.99).
- Even though the current debt-to-equity ratio is 1.12, it is still below the industry average, suggesting that this level of debt is acceptable within the Capital Markets industry.
- Compared to its closing price of one year ago, TCAP's share price has jumped by 36.05%, exceeding the performance of the broader market during that same time frame. Although TCAP 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 revenue growth greatly exceeded the industry average of 9.2%. Since the same quarter one year prior, revenues rose by 37.4%. 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.