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) -- Planet Payment (Nasdaq: PLPM) has been upgraded by TheStreet Ratings from sell 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 increase in stock price during the past year. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.
- 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.
- The revenue growth came in higher than the industry average of 22.9%. Since the same quarter one year prior, revenues slightly increased by 5.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- PLPM's debt-to-equity ratio is very low at 0.10 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, PLPM has a quick ratio of 1.90, which demonstrates the ability of the company to cover short-term liquidity needs.
- PLANET PAYMENT INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, PLANET PAYMENT INC swung to a loss, reporting -$0.10 versus $0.03 in the prior year. This year, the market expects an improvement in earnings ($0.02 versus -$0.10).
- 45.81% is the gross profit margin for PLANET PAYMENT INC which we consider to be strong. Regardless of PLPM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, PLPM's net profit margin of -7.72% significantly underperformed when compared to the industry average.
- 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 IT Services industry and the overall market, PLANET PAYMENT INC's return on equity significantly trails that of both the industry average and the S&P 500.