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) -- Con-way (NYSE: CNW) 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, attractive valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and a generally disappointing performance in the stock itself.
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- Despite its growing revenue, the company underperformed as compared with the industry average of 4.9%. Since the same quarter one year prior, revenues slightly increased by 2.0%. 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.
- CNW's debt-to-equity ratio of 0.92 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that CNW's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.51 is high and demonstrates strong liquidity.
- The gross profit margin for CON-WAY INC is currently extremely low, coming in at 7.90%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.80% significantly trails the industry average.
- The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Road & Rail industry average. The net income has decreased by 13.1% when compared to the same quarter one year ago, dropping from $29.13 million to $25.30 million.
-- Written by a member of TheStreet Ratings Staff