NEW YORK ( TheStreet) -- Claude Resources (AMEX: CGR) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income and weak operating cash flow.

Highlights from the ratings report include:
  • The revenue growth significantly trails the industry average of 72.6%. Since the same quarter one year prior, revenues rose by 16.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • CGR's debt-to-equity ratio is very low at 0.08 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.06, which clearly demonstrates the ability to cover short-term cash needs.
  • CLAUDE RESOURCES INC reported flat earnings per share in the most recent quarter. This company has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, CLAUDE RESOURCES INC turned its bottom line around by earning $0.03 versus -$0.07 in the prior year.
  • Net operating cash flow has significantly decreased to $0.51 million or 94.25% 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, 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 Metals & Mining industry. The net income has significantly decreased by 38.3% when compared to the same quarter one year ago, falling from $4.28 million to $2.64 million.

Claude Resources Inc. engages in the acquisition, exploration, and development of precious metal properties, as well as production and marketing of minerals in Canada. It primarily explores for gold in northern Saskatchewan and northwestern Ontario. The company has a P/E ratio of 35.4, above the average metals & mining industry P/E ratio of 24.8 and above the S&P 500 P/E ratio of 17.7. Claude has a market cap of $290.5 million and is part of the basic materials sector and metals & mining industry. Shares are down 19.2% year to date as of the close of trading on Tuesday.

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

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