NEW YORK ( TheStreet) -- Integra LifeSciences Holdings (Nasdaq: IART) 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, expanding profit margins and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income 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. When compared to other companies in the Health Care Equipment & Supplies industry and the overall market, INTEGRA LIFESCIENCES HLDGS's return on equity is below 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 95.4% when compared to the same quarter one year ago, falling from $15.16 million to $0.70 million.
  • The gross profit margin for INTEGRA LIFESCIENCES HLDGS is rather high; currently it is at 61.90%. Regardless of IART's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, IART's net profit margin of 0.40% is significantly lower than the same period one year prior.
  • INTEGRA LIFESCIENCES HLDGS 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. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, INTEGRA LIFESCIENCES HLDGS increased its bottom line by earning $2.18 versus $1.72 in the prior year. This year, the market expects an improvement in earnings ($2.98 versus $2.18).
  • IART's revenue growth has slightly outpaced the industry average of 6.3%. Since the same quarter one year prior, revenues slightly increased by 8.2%. 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.

Integra LifeSciences Holdings Corporation develops, manufactures, and markets surgical implants and medical instruments for neurosurgery, extremity reconstruction, orthopedics, and general surgery. The company has a P/E ratio of 22.3, above the average health services industry P/E ratio of 22.2 and above the S&P 500 P/E ratio of 17.7. Integra LifeSciences has a market cap of $1.3 billion and is part of the health care sector and health services industry. Shares are down 3.1% year to date as of the close of trading on Friday.

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

If you liked this article you might like

Johnson & Johnson Signals It Could Make Additional Divestitures

Integra's Massive Run-Up Expected to Continue as J&J's Surgical Business Joins the Fold

Integra Scoops up JNJ's Codman Neurosurgery for $1.05 Billion

Integra Scoops Up JNJ's Codman Neurosurgery for $1.05 Billion

Derma Sciences Soars Almost 40% on Buyout by Integra