NEW YORK ( TheStreet) -- Immucor (Nasdaq: BLUD) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and disappointing return on equity. Highlights from the ratings report include:
- 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 on the basis of return on equity, IMMUCOR INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- BLUD has underperformed the S&P 500 Index, declining 8.46% from its price level of one year ago. 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.
- The net income growth from the same quarter one year ago has exceeded that of the Health Care Equipment & Supplies industry average, but is less than that of the S&P 500. The net income increased by 6.9% when compared to the same quarter one year prior, going from $19.70 million to $21.06 million.
- The gross profit margin for IMMUCOR INC is currently very high, coming in at 75.80%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 25.80% is above that of the industry average.
- BLUD has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 7.31, which clearly demonstrates the ability to cover short-term cash needs.