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) -- Greenway Medical Technologies (NYSE: GWAY) 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 unimpressive growth in net income.
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- The share price of GREENWAY MEDICAL TECH INC has not done very well: it is down 14.74% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Health Care Technology industry. The net income has significantly decreased by 267.5% when compared to the same quarter one year ago, falling from -$0.27 million to -$0.99 million.
- GREENWAY MEDICAL TECH 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 sound management over its earnings and share float. However, the consensus estimates suggest that there will be an upward trend in the coming year. During the past fiscal year, GREENWAY MEDICAL TECH INC increased its bottom line by earning $0.10 versus $0.09 in the prior year. This year, the market expects an improvement in earnings ($0.18 versus $0.10).
- Compared to other companies in the Health Care Technology industry and the overall market, GREENWAY MEDICAL TECH INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has increased to $3.66 million or 22.33% when compared to the same quarter last year. Despite an increase in cash flow, GREENWAY MEDICAL TECH INC's average is still marginally south of the industry average growth rate of 29.88%.
-- Written by a member of TheStreet Ratings Staff