NEW YORK ( TheStreet) -- PAR Technology Corp (NYSE: PAR) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

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 Electronic Equipment, Instruments & Components industry. The net income has significantly decreased by 2202.2% when compared to the same quarter one year ago, falling from $0.85 million to -$17.85 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, PAR TECHNOLOGY CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for PAR TECHNOLOGY CORP is currently lower than what is desirable, coming in at 25.30%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -30.60% is significantly below that of the industry average.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 41.06%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 2083.33% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • PAR TECHNOLOGY CORP 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. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, PAR TECHNOLOGY CORP turned its bottom line around by earning $0.22 versus -$0.34 in the prior year. For the next year, the market is expecting a contraction of 9.1% in earnings ($0.20 versus $0.22).

PAR Technology Corporation provides professional services and enterprise business management technology to the hospitality industry worldwide. The company operates through two segments, Hospitality and Government. The company has a P/E ratio of 17.2, above the average consumer durables industry P/E ratio of 16.4 and below the S&P 500 P/E ratio of 17.7. PAR Technology has a market cap of $52 million and is part of the consumer goods sector and consumer durables industry. Shares are down 39.4% year to date as of the close of trading on Thursday.

You can view the full PAR Technology Ratings Report or get investment ideas from our investment research center.
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