Joy Global Inc. Stock Hold Recommendation Reiterated (JOY)

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) -- Joy Global (NYSE: JOY) has been reiterated by TheStreet Ratings as a hold with a ratings score of C+. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow, a generally disappointing performance in the stock itself and feeble growth in the company's earnings per share.

  • EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stocks Under $10 that he thinks could potentially double. See what he's trading today with a 14-day FREE pass.

Highlights from the ratings report include:
  • The current debt-to-equity ratio, 0.48, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.94 is somewhat weak and could be cause for future problems.
  • 35.30% is the gross profit margin for JOY GLOBAL INC which we consider to be strong. Regardless of JOY's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, JOY's net profit margin of 13.34% compares favorably to the industry average.
  • In its most recent trading session, JOY has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. 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.
  • Net operating cash flow has significantly decreased to $0.41 million or 99.60% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

Joy Global Inc. engages in the manufacture and servicing of mining equipment for the extraction of coal, copper, iron ore, oil sands, and other minerals. It operates in two segments, Underground Mining Machinery and Surface Mining Equipment. Joy Global has a market cap of $5.6 billion and is part of the industrial goods sector and industrial industry. The company has a P/E ratio of 8.00, below the S&P 500 P/E ratio of 18.00. Shares are down 16.8% year to date as of the close of trading on Tuesday.

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

--Written by a member of TheStreet Ratings Staff.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

null

More from Markets

3 Must Reads on the Market From TheStreet's Top Columnists

3 Must Reads on the Market From TheStreet's Top Columnists

Purdue Pharma Unloads Sales Staff, Transitioning From Painkiller Focus

Purdue Pharma Unloads Sales Staff, Transitioning From Painkiller Focus

Dow Finishes Lower as Nasdaq Posts New Record

Dow Finishes Lower as Nasdaq Posts New Record

Airlines Rebuke Trump Policy of Separating Children

Airlines Rebuke Trump Policy of Separating Children

Deutsche Bank Fined $205 Million Over Currency-Trading Violations

Deutsche Bank Fined $205 Million Over Currency-Trading Violations