Bankrate Inc Stock Downgraded (RATE)

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) -- Bankrate (NYSE: RATE) has been downgraded by TheStreet Ratings from hold to sell. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

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Highlights from the ratings report include:
  • RATE's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 33.77%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
  • In comparison to the other companies in the Internet Software & Services industry and the overall market, BANKRATE INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • The gross profit margin for BANKRATE INC is rather high; currently it is at 69.20%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 13.30% trails the industry average.
  • Net operating cash flow has improved to $31.07 million from having none in the same quarter last year. Since the company had no net operating cash flow for the prior period, we cannot calculate a percent change in order to compare its growth rate with that of its industry average.
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Bankrate, Inc. publishes, aggregates, and distributes personal finance content on the Internet. The company has a P/E ratio of 28.4, below the average internet industry P/E ratio of 29.6 and above the S&P 500 P/E ratio of 17.7. Bankrate has a market cap of $1.45 billion and is part of the technology sector and internet industry. Shares are down 47.6% year to date as of the close of trading on Wednesday.

You can view the full Bankrate Ratings Report or get investment ideas from our investment research center.

-- Written by a member of TheStreet Ratings Staff

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