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) -- National American University Holdings (Nasdaq: NAUH) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, 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.
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- The revenue growth came in higher than the industry average of 11.3%. Since the same quarter one year prior, revenues rose by 15.9%. 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.
- NAUH's debt-to-equity ratio is very low at 0.21 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, NAUH has a quick ratio of 2.48, which demonstrates the ability of the company to cover short-term liquidity needs.
- The gross profit margin for NATIONAL AMERN UNIV HLDG INC is currently very high, coming in at 74.10%. Regardless of NAUH's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of -0.60% trails the industry average.
- Net operating cash flow has significantly decreased to $0.68 million or 76.37% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, NATIONAL AMERN UNIV HLDG INC has marginally lower results.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 43.08%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 125.00% compared to the year-earlier quarter. Although its share price is down sharply from a year ago, do not assume that it can now be tagged as cheap and attractive. The reality is that, based on its current price in relation to its earnings, NAUH is still more expensive than most of the other companies in its industry.
-- Written by a member of TheStreet Ratings Staff