NEW YORK ( TheStreet) -- TRC Companies (NYSE: TRR) has been upgraded by TheStreet Ratings from sell 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 impressive record of earnings per share growth. However, as a counter to these strengths, we find that the company's profit margins have been poor overall.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 1.7%. Since the same quarter one year prior, revenues rose by 27.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Although TRR's debt-to-equity ratio of 0.22 is very low, it is currently higher than that of the industry average. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.04, which illustrates the ability to avoid short-term cash problems.
  • 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 Services & Supplies industry and the overall market, TRC COS INC's return on equity is below that of both the industry average and the S&P 500.
  • The gross profit margin for TRC COS INC is rather low; currently it is at 18.10%. It has decreased from the same quarter the previous year. Despite the weak results of the gross profit margin, the net profit margin of 25.40% has significantly outperformed against the industry average.

TRC Companies, Inc. provides consulting, engineering, and construction management services in the United States. The company has a P/E ratio of 138.3, above the S&P 500 P/E ratio of 17.7. TRC Companies has a market cap of $115.4 million and is part of the industrial goods sector and materials & construction industry. Shares are up 16.9% year to date as of the close of trading on Tuesday.

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