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) -- GenCorp (NYSE: GY) 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 and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and poor profit margins.
- EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stocks Under $10 that he thinks could potentially double. See what he's trading today with a 14-day FREE pass.
- GY's revenue growth has slightly outpaced the industry average of 6.0%. Since the same quarter one year prior, revenues slightly increased by 8.3%. 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.
- Compared to its closing price of one year ago, GY's share price has jumped by 105.50%, exceeding the performance of the broader market during that same time frame. Although GY had significant growth over the past year, our hold rating indicates that we do not recommend additional investment in this stock at the current time.
- GENCORP 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. Stable earnings per share over the past year indicate the company has managed its earnings and share float. We anticipate this stability to falter in the coming year and, in turn, the company to deliver lower earnings per share than prior full year. During the past fiscal year, GENCORP INC reported lower earnings of $0.05 versus $0.06 in the prior year. For the next year, the market is expecting a contraction of 100.0% in earnings ($0.00 versus $0.05).
- The gross profit margin for GENCORP INC is currently extremely low, coming in at 12.60%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -3.87% is significantly below that of the industry average.
- Net operating cash flow has decreased to $15.70 million or 13.73% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
-- Written by a member of TheStreet Ratings Staff