NEW YORK ( TheStreet) -- Innovative Solutions & Support (Nasdaq: ISSC) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its 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 a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity. Highlights from the ratings report include:
- ISSC'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 this, the company maintains a quick ratio of 10.84, which clearly demonstrates the ability to cover short-term cash needs.
- 48.20% is the gross profit margin for INNOVATIVE SOLTNS & SUPP INC which we consider to be strong. Regardless of ISSC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ISSC's net profit margin of -7.20% significantly underperformed when compared to the industry average.
- Net operating cash flow has decreased to $0.62 million or 40.53% 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's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Aerospace & Defense industry and the overall market, INNOVATIVE SOLTNS & SUPP 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