NEW YORK ( TheStreet) -- Central Vermont Public Service Corporation (NYSE: CV) has been downgraded by TheStreet Ratings from buy 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 also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:
  • Despite its growing revenue, the company underperformed as compared with the industry average of 7.4%. Since the same quarter one year prior, revenues slightly increased by 3.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • The debt-to-equity ratio is somewhat low, currently at 0.87, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.39 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • The gross profit margin for CENTRAL VERMONT PUB SERV is currently extremely low, coming in at 12.50%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -9.80% is significantly below that of the industry average.
  • Net operating cash flow has declined marginally to $10.25 million or 4.98% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

Central Vermont Public Service Corporation, together with its subsidiaries, operates as an electric utility company in Vermont, the United States. The company has a P/E ratio of 86, above the average utilities industry P/E ratio of 85.7 and above the S&P 500 P/E ratio of 17.7. Central Vermont Public Service has a market cap of $472.1 million and is part of the utilities sector and utilities industry. Shares are up 0.2% year to date as of the close of trading on Thursday.

You can view the full Central Vermont Public Service Ratings Report or get investment ideas from our investment research center.
-- Written by a member of TheStreet Ratings Staff