NEW YORK ( TheStreet) -- Guidance Software (Nasdaq: GUID) 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 solid stock price performance. However, as a counter to these strengths, we find that the company's return on equity has been disappointing. Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 0.2%. Since the same quarter one year prior, revenues rose by 15.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- GUID's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.22, which illustrates the ability to avoid short-term cash problems.
- The gross profit margin for GUIDANCE SOFTWARE INC is currently very high, coming in at 77.20%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, GUID's net profit margin of 7.60% significantly trails the industry average.
- 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. Compared to other companies in the Software industry and the overall market, GUIDANCE SOFTWARE INC's return on equity significantly trails that of both the industry average and the S&P 500.
-- Written by a member of TheStreet RatingsStaff