NEW YORK ( TheStreet) -- Met-Pro Corporation (NYSE: MPR) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall. Highlights from the ratings report include:
- Net operating cash flow has significantly decreased to -$2.11 million or 191.86% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Machinery industry and the overall market, MET-PRO CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- 36.50% is the gross profit margin for MET-PRO CORP which we consider to be strong. Regardless of MPR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 6.00% trails the industry average.
- MPR's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.79, which clearly demonstrates the ability to cover short-term cash needs.
- The revenue growth significantly trails the industry average of 49.8%. Since the same quarter one year prior, revenues slightly increased by 5.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.