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) -- BioDelivery Sciences International (Nasdaq: BDSI) 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 Pharmaceuticals industry. The net income has significantly decreased by 276.8% when compared to the same quarter one year ago, falling from -$5.12 million to -$19.30 million.
- Net operating cash flow has significantly decreased to -$13.30 million or 122.42% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- BIODELIVERY SCIENCES INTL 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. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, BIODELIVERY SCIENCES INTL reported poor results of -$0.85 versus -$0.58 in the prior year. This year, the market expects an improvement in earnings ($0.16 versus -$0.85).
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Pharmaceuticals industry and the overall market, BIODELIVERY SCIENCES INTL's return on equity significantly trails that of both the industry average and the S&P 500.
- BDSI, with its very weak revenue results, has greatly underperformed against the industry average of 3.8%. Since the same quarter one year prior, revenues plummeted by 98.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
-- Written by a member of TheStreet Ratings Staff