Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link. NEW YORK ( TheStreet) -- CNA Financial (NYSE: CNA) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and poor profit margins.
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- The revenue growth came in higher than the industry average of 6.5%. Since the same quarter one year prior, revenues rose by 11.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- CNA's debt-to-equity ratio is very low at 0.22 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- The gross profit margin for CNA FINANCIAL CORP is currently extremely low, coming in at 13.72%. Regardless of CNA's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, CNA's net profit margin of 7.78% compares favorably to the industry average.
- 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. When compared to other companies in the Insurance industry and the overall market, CNA FINANCIAL CORP's return on equity is below that of both the industry average and the S&P 500.