NEW YORK ( TheStreet) -- MYR Group (Nasdaq: MYRG) 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 solid stock price performance. However, as a counter to these strengths, we also find weaknesses including poor profit margins and weak operating cash flow.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 18.5%. Since the same quarter one year prior, revenues rose by 32.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • MYRG'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. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.96 is somewhat weak and could be cause for future problems.
  • The gross profit margin for MYR GROUP INC is currently extremely low, coming in at 13.00%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 2.00% trails that of the industry average.
  • Net operating cash flow has significantly decreased to $0.45 million or 96.49% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

MYR Group Inc., through its subsidiaries, provides utility and electrical construction services in the continental United States. It operates in two segments, Transmission and Distribution, and Commercial and Industrial. The company has a P/E ratio of 22.5, above the average materials & construction industry P/E ratio of 22.3 and above the S&P 500 P/E ratio of 17.7. MYR Group has a market cap of $396.1 million and is part of the industrial goods sector and materials & construction industry. Shares are down 11% year to date as of the close of trading on Friday.

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