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) -- Boingo Wireless (Nasdaq: WIFI) has been upgraded by TheStreet Ratings from sell to hold. Among the primary strengths of the company is its expanding profit margins over time. At the same time, however, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.
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- WIFI, with its decline in revenue, slightly underperformed the industry average of 2.1%. Since the same quarter one year prior, revenues slightly dropped by 4.3%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- The gross profit margin for BOINGO WIRELESS INC is rather high; currently it is at 57.10%. Regardless of WIFI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, WIFI's net profit margin of -4.84% significantly underperformed when compared to the industry average.
- Net operating cash flow has declined marginally to $5.26 million or 7.18% when compared to the same quarter last year. Despite a decrease in cash flow BOINGO WIRELESS INC is still fairing well by exceeding its industry average cash flow growth rate of -18.36%.
- 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 Wireless Telecommunication Services industry. The net income has significantly decreased by 167.7% when compared to the same quarter one year ago, falling from $1.66 million to -$1.12 million.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Wireless Telecommunication Services industry and the overall market, BOINGO WIRELESS INC's return on equity significantly trails that of both the industry average and the S&P 500.
-- Written by a member of TheStreet Ratings Staff