NEW YORK ( TheStreet) -- Orthovita (Nasdaq: VITA) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity and feeble growth in its earnings per share.

Highlights from the ratings report include:
  • VITA, with its decline in revenue, slightly underperformed the industry average of 0.1%. Since the same quarter one year prior, revenues slightly dropped by 4.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • This stock's share value has moved by only 40.00% over the past year. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • ORTHOVITA INC's earnings have gone downhill when comparing its most recently reported quarter with the same quarter a year earlier. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, ORTHOVITA INC reported poor results of -$0.08 versus -$0.05 in the prior year. This year, the market expects an improvement in earnings (-$0.03 versus -$0.08).
  • 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 Health Care Equipment & Supplies industry and the overall market, ORTHOVITA INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • 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 Health Care Equipment & Supplies industry. The net income has significantly decreased by 1169.0% when compared to the same quarter one year ago, falling from -$0.29 million to -$3.68 million.

Orthovita, Inc., a specialty spine and orthopedic company, develops and markets orthobiologic and biosurgery products. The company has a P/E ratio of 20.2, above the S&P 500 P/E ratio of 17.2. Orthovita has a market cap of $170.7 million and is part of the health care sector and health services industry. Shares are up nine% year to date as of the close of trading on Friday.

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