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) -- Symmetricom (Nasdaq: SYMM) 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, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income and feeble growth in the company's earnings per share.
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- Despite its growing revenue, the company underperformed as compared with the industry average of 2.7%. Since the same quarter one year prior, revenues slightly increased by 0.0%. 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.
- SYMM has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 3.05, which clearly demonstrates the ability to cover short-term cash needs.
- 45.60% is the gross profit margin for SYMMETRICOM INC which we consider to be strong. Regardless of SYMM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SYMM's net profit margin of -0.40% significantly underperformed when compared to the industry average.
- SYMMETRICOM INC has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from 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, SYMMETRICOM INC increased its bottom line by earning $0.26 versus $0.03 in the prior year. For the next year, the market is expecting a contraction of 9.6% in earnings ($0.24 versus $0.26).
- 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 Communications Equipment industry. The net income has significantly decreased by 107.4% when compared to the same quarter one year ago, falling from $2.75 million to -$0.20 million.
-- Written by a member of TheStreet Ratings Staff