NEW YORK ( TheStreet) -- iStar Financial (NYSE: SFI) has been downgraded by TheStreet Ratings from hold to sell. Among the areas we feel are negative, one of the most important has been poor debt management on most measures. Highlights from the ratings report include:
- This stock has increased by 65.26% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the future course of this stock, we feel that the risks involved in investing in SFI do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
- 45.00% is the gross profit margin for ISTAR FINANCIAL INC which we consider to be strong. It has increased significantly from the same period last year. Along with this, the net profit margin of 61.10% significantly outperformed against the industry average.
- The revenue fell significantly faster than the industry average of 5.5%. Since the same quarter one year prior, revenues fell by 26.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, ISTAR FINANCIAL INC's return on equity significantly trails that of both the industry average and the S&P 500.
- The debt-to-equity ratio is very high at 4.02 and currently higher than the industry average, implying that there is very poor management of debt levels within the company.