Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model NEW YORK ( TheStreet) -- Eldorado Gold (NYSE: EGO) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
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- EGO's debt-to-equity ratio is very low at 0.02 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- The gross profit margin for ELDORADO GOLD CORP is rather high; currently it is at 61.30%. Regardless of EGO's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, EGO's net profit margin of 19.10% compares favorably to the industry average.
- Despite the weak revenue results, EGO has outperformed against the industry average of 14.1%. Since the same quarter one year prior, revenues slightly dropped by 3.3%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- ELDORADO GOLD CORP's earnings per share declined by 50.0% in the most recent quarter compared to the same quarter a year ago. 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, ELDORADO GOLD CORP increased its bottom line by earning $0.59 versus $0.38 in the prior year.
-- Written by a member of TheStreet Ratings Staff