NEW YORK ( TheStreet) -- Stillwater Mining Company (NYSE: SWC) 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, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that the company's profit margins have been poor overall.

Highlights from the ratings report include:
  • The gross profit margin for STILLWATER MINING CO is currently lower than what is desirable, coming in at 33.70%. Regardless of SWC's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, SWC's net profit margin of 11.40% is significantly lower than the same period one year prior.
  • Powered by its strong earnings growth of 328.57% and other important driving factors, this stock has surged by 55.79% over the past year, outperforming the rise in the S&P 500 Index during the same period. Looking ahead, however, we cannot assume that the stock's past performance is going to drive future results. Quite to the contrary, its sharp appreciation over the last year is one of the factors that should prompt investors to seek better opportunities elsewhere.
  • Net operating cash flow has significantly increased by 257.65% to $28.58 million when compared to the same quarter last year. Despite an increase in cash flow, STILLWATER MINING CO's cash flow growth rate is still lower than the industry average growth rate of 284.54%.
  • STILLWATER MINING CO reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, STILLWATER MINING CO turned its bottom line around by earning $0.51 versus -$0.10 in the prior year. This year, the market expects an improvement in earnings ($1.69 versus $0.51).
  • SWC's revenue growth has slightly outpaced the industry average of 32.8%. Since the same quarter one year prior, revenues rose by 42.1%. Growth in the company's revenue appears to have helped boost the earnings per share.

Stillwater Mining Company engages in the development, extraction, processing, refining, and marketing of palladium, platinum, and associated metals in south central Montana, the United States. The company has a P/E ratio of 42.6, equal to the average metals & mining industry P/E ratio and above the S&P 500 P/E ratio of 17.2. Stillwater has a market cap of $2.2 billion and is part of the basic materials sector and metals & mining industry. Shares are up 2.7% year to date as of the close of trading on Friday.

You can view the full Stillwater Ratings Report or get investment ideas from our investment research center.