NEW YORK ( TheStreet) -- Baldwin & Lyons (Nasdaq: BWINB) has been downgraded by TheStreet Ratings from buy to hold. Among the primary strengths of the company is its revenue growth. At the same time, however, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:
  • 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 Insurance industry. The net income has significantly decreased by 2888.6% when compared to the same quarter one year ago, falling from $0.55 million to -$15.20 million.
  • BALDWIN & LYONS has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, BALDWIN & LYONS reported lower earnings of $1.68 versus $3.04 in the prior year. For the next year, the market is expecting a contraction of 46.4% in earnings ($0.90 versus $1.68).
  • The share price of BALDWIN & LYONS has not done very well: it is down 9.16% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. 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.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 8.6%. Since the same quarter one year prior, revenues slightly increased by 5.6%. 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.

Baldwin & Lyons, Inc., through its subsidiaries, engages in marketing and underwriting property and casualty insurance products primarily in the United States and Canada. The company provides various fleet transportation insurance products for the motor carrier industry. The company has a P/E ratio of 26.5, below the average insurance industry P/E ratio of 35.4 and above the S&P 500 P/E ratio of 17.7. Baldwin & Lyons has a market cap of $268.2 million and is part of the financial sector and insurance industry. Shares are down 6.8% year to date as of the close of trading on Wednesday.

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