NEW YORK ( TheStreet) -- Lihua International (Nasdaq: LIWA) has been upgraded by TheStreet Ratings from sell 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 notable return on equity. However, as a counter to these strengths, we also find weaknesses including poor profit margins, weak operating cash flow and a generally disappointing performance in the stock itself. Highlights from the ratings report include:
- LIWA's very impressive revenue growth greatly exceeded the industry average of 1.0%. Since the same quarter one year prior, revenues leaped by 61.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
- LIWA's debt-to-equity ratio is very low at 0.01 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 6.91, which clearly demonstrates the ability to cover short-term cash needs.
- Net operating cash flow has declined marginally to $8.74 million or 0.54% when compared to the same quarter last year. Despite a decrease in cash flow LIHUA INTERNATIONAL INC is still fairing well by exceeding its industry average cash flow growth rate of -27.39%.
- The gross profit margin for LIHUA INTERNATIONAL INC is currently extremely low, coming in at 12.60%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 8.70% trails that of the industry average.