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) -- Imperva (NYSE: IMPV) 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 and feeble growth in its earnings per share.
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- 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 Software industry. The net income has significantly decreased by 85.2% when compared to the same quarter one year ago, falling from -$3.27 million to -$6.06 million.
- IMPERVA 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, IMPERVA INC reported poor results of -$0.33 versus -$0.32 in the prior year. This year, the market expects an improvement in earnings ($0.05 versus -$0.33).
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Software industry and the overall market, IMPERVA INC's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for IMPERVA INC is currently very high, coming in at 80.20%. Regardless of IMPV's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, IMPV's net profit margin of -21.19% significantly underperformed when compared to the industry average.
- Net operating cash flow has significantly increased by 133.19% to $7.69 million when compared to the same quarter last year. In addition, IMPERVA INC has also vastly surpassed the industry average cash flow growth rate of -7.09%.
-- Written by a member of TheStreet Ratings Staff