Navarre Corporation Stock Upgraded (NAVR)

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) -- Navarre Corporation (Nasdaq: NAVR) 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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Highlights from the ratings report include:
  • NAVR's revenue growth has slightly outpaced the industry average of 13.9%. Since the same quarter one year prior, revenues rose by 16.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • NAVARRE CORP 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, NAVARRE CORP swung to a loss, reporting -$0.93 versus $0.34 in the prior year. This year, the market expects an improvement in earnings ($0.00 versus -$0.93).
  • 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 Media industry and the overall market, NAVARRE CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for NAVARRE CORP is currently extremely low, coming in at 9.70%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.00% significantly trails the industry average.
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Navarre Corporation distributes and provides logistics solutions to traditional and e-commerce retail channels; and publishes computer software in the United States and Canada. It operates in two segments, Distribution and Publishing. Navarre has a market cap of $70.9 million and is part of the services sector and wholesale industry. Shares are up 6.7% year to date as of the close of trading on Tuesday.

You can view the full Navarre Ratings Report or get investment ideas from our investment research center.

-- Written by a member of TheStreet Ratings Staff

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.

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