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) -- Cemex S.A.B. de C.V (NYSE: CX) 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, solid stock price performance and compelling growth in net income. However, as a counter to these strengths, we find that the company's profit margins have been poor overall.
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- CX's very impressive revenue growth greatly exceeded the industry average of 35.6%. Since the same quarter one year prior, revenues leaped by 70.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Powered by its strong earnings growth of 67.50% and other important driving factors, this stock has surged by 64.88% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- CEMEX SAB DE CV reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CEMEX SAB DE CV reported poor results of -$1.28 versus -$1.24 in the prior year. This year, the market expects an improvement in earnings (-$0.48 versus -$1.28).
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Construction Materials industry and the overall market, CEMEX SAB DE CV's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for CEMEX SAB DE CV is currently lower than what is desirable, coming in at 30.60%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -5.03% trails that of the industry average.
-- Written by a member of TheStreet Ratings Staff