- The revenue growth came in higher than the industry average of 3.4%. Since the same quarter one year prior, revenues rose by 14.1%. 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.
- Compared to its closing price of one year ago, EGHT's share price has jumped by 63.29%, exceeding the performance of the broader market during that same time frame. Setting our sights on the months ahead, however, we feel that the stock's sharp appreciation over the last year has driven it to a price level which is now relatively expensive compared to the rest of its industry. The implication is that its reduced upside potential is not good enough to warrant further investment at this time.
- 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. When compared to other companies in the Diversified Telecommunication Services industry and the overall market, 8X8 INC's return on equity is below that of both the industry average and the S&P 500.
NEW YORK ( TheStreet) -- 8x8 (Nasdaq: EGHT) 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, solid stock price performance and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, premium valuation and unimpressive growth in net income. Highlights from the ratings report include: