NEW YORK ( TheStreet) -- Macatawa Bank Corporation (Nasdaq: MCBC) has been downgraded by TheStreet Ratings from hold to sell. Among the areas we feel are negative, one of the most important has been weak operating cash flow.

Highlights from the ratings report include:
  • Net operating cash flow has significantly decreased to -$2.97 million or 119.19% 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 greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. When compared to other companies in the Commercial Banks industry and the overall market, MACATAWA BANK CORP's return on equity is below that of both the industry average and the S&P 500.
  • The revenue fell significantly faster than the industry average of 24.9%. Since the same quarter one year prior, revenues fell by 15.1%. Weakness in the company's revenue seems to not be hurting the bottom line, shown by stable earnings per share.
  • The gross profit margin for MACATAWA BANK CORP is currently very high, coming in at 88.60%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 5.60% trails the industry average.

Macatawa Bank Corporation operates as the holding company for Macatawa Bank that provides various commercial and personal banking services. The company has a P/E ratio of 9.5, above the average banking industry P/E ratio of 8.8 and below the S&P 500 P/E ratio of 17.7. Macatawa has a market cap of $69.3 million and is part of the financial sector and banking industry. Shares are down 37.9% year to date as of the close of trading on Thursday.

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

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