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) -- Cincinnati Bell (NYSE: CBB) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself and weak operating cash flow.
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- CBB has underperformed the S&P 500 Index, declining 16.54% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
- Net operating cash flow has decreased to $57.70 million or 36.87% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- The gross profit margin for CINCINNATI BELL INC is rather high; currently it is at 50.70%. Regardless of CBB's high profit margin, it has managed to decrease from the same period last year.
- CINCINNATI BELL INC 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, CINCINNATI BELL INC reported lower earnings of $0.01 versus $0.03 in the prior year. This year, the market expects an improvement in earnings ($0.02 versus $0.01).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Diversified Telecommunication Services industry. The net income increased by 67.8% when compared to the same quarter one year prior, rising from -$30.40 million to -$9.80 million.
-- Written by a member of TheStreet Ratings Staff