NEW YORK ( TheStreet) -- Triangle Petroleum (AMEX: TPLM) 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, weak operating cash flow 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 6423.7% when compared to the same quarter one year ago, falling from -$0.10 million to -$6.33 million.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, TRIANGLE PETROLEUM CORP's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has significantly decreased to -$2.59 million or 185.65% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- TRIANGLE PETROLEUM CORP's earnings have gone downhill when comparing its most recently reported quarter with the same quarter a year earlier. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, TRIANGLE PETROLEUM CORP reported poor results of -$1.06 versus -$0.30 in the prior year. This year, the market expects an improvement in earnings (-$0.03 versus -$1.06).
- This stock has managed to decline in share value by 0.78% over the past twelve months. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.