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) -- Sinovac Biotech (Nasdaq: SVA) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, weak operating cash flow and feeble growth in its earnings per share.
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- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Biotechnology industry. The net income has significantly decreased by 41.3% when compared to the same quarter one year ago, falling from -$2.14 million to -$3.03 million.
- Net operating cash flow has significantly decreased to -$6.26 million or 482.81% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- SINOVAC BIOTECH LTD's earnings per share declined by 50.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, SINOVAC BIOTECH LTD continued to lose money by earning -$0.02 versus -$0.17 in the prior year. For the next year, the market is expecting a contraction of 1075.0% in earnings (-$0.24 versus -$0.02).
- SVA, with its decline in revenue, underperformed when compared the industry average of 5.7%. Since the same quarter one year prior, revenues slightly dropped by 7.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- The gross profit margin for SINOVAC BIOTECH LTD is rather high; currently it is at 57.40%. Regardless of SVA's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SVA's net profit margin of -21.20% significantly underperformed when compared to the industry average.
-- Written by a member of TheStreet Ratings Staff