NEW YORK ( TheStreet) -- Triple-S Management Corporation (NYSE: GTS) 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 attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and poor profit margins.

Highlights from the ratings report include:
  • Despite its growing revenue, the company underperformed as compared with the industry average of 6.8%. Since the same quarter one year prior, revenues slightly increased by 2.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The current debt-to-equity ratio, 0.31, is low and is below the industry average, implying that there has been successful management of debt levels.
  • Net operating cash flow has significantly decreased to -$23.40 million or 2221.84% 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 company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Health Care Providers & Services industry and the overall market, TRIPLE-S MANAGEMENT CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.

Triple-S Management Corporation, through its subsidiaries, operates as a managed care company in Puerto Rico. It provides health benefits services to subscribers through contracts with hospitals, physicians, dentists, laboratories, and other organizations. The company has a P/E ratio of seven, equal to the average insurance industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Triple-S Management has a market cap of $473.9 million and is part of the financial sector and insurance industry. Shares are down 12.9% year to date as of the close of trading on Tuesday.

You can view the full Triple-S Management Ratings Report or get investment ideas from our investment research center.
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