PAR Technology Corp. Stock Downgraded (PAR)

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) -- PAR Technology (NYSE: PAR) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, poor profit margins and generally disappointing historical performance in the stock itself.

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Highlights from the ratings report include:
  • 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 Electronic Equipment, Instruments & Components industry. The net income has significantly decreased by 115.6% when compared to the same quarter one year ago, falling from $2.47 million to -$0.38 million.
  • The gross profit margin for PAR TECHNOLOGY CORP is rather low; currently it is at 19.80%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -0.57% trails that of the industry average.
  • The share price of PAR TECHNOLOGY CORP has not done very well: it is down 19.72% 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. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • 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 Electronic Equipment, Instruments & Components industry and the overall market, PAR TECHNOLOGY CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • PAR TECHNOLOGY CORP 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. This company has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, PAR TECHNOLOGY CORP continued to lose money by earning -$0.11 versus -$0.89 in the prior year.
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PAR Technology Corporation, through its subsidiaries, provides technology solutions to businesses and organizations in the hospitality industry worldwide. The company operates in two segments: Hospitality and Government. PAR Technology has a market cap of $60.1 million and is part of the technology sector and computer software & services industry. Shares are down 20% year to date as of the close of trading on Monday.

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

-- Written by a member of TheStreet Ratings Staff

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