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) -- Pope Resources (Nasdaq: POPE) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance and largely solid financial position with reasonable debt levels by most measures. 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 disappointing return on equity.
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- The debt-to-equity ratio is somewhat low, currently at 0.68, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
- Compared to its closing price of one year ago, POPE's share price has jumped by 41.94%, exceeding the performance of the broader market during that same time frame. Although POPE 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.
- The revenue fell significantly faster than the industry average of 15.2%. Since the same quarter one year prior, revenues fell by 27.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The gross profit margin for POPE RESOURCES/DE -LP is currently lower than what is desirable, coming in at 31.60%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -2.29% trails that of the industry average.
- Net operating cash flow has decreased to $4.28 million or 42.09% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
-- Written by a member of TheStreet Ratings Staff