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) -- Spirit AeroSystems Holdings (NYSE: SPR) has been downgraded by TheStreet Ratings from buy to hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.
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- Despite its growing revenue, the company underperformed as compared with the industry average of 7.7%. Since the same quarter one year prior, revenues slightly increased by 4.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Compared to its closing price of one year ago, SPR's share price has jumped by 61.74%, exceeding the performance of the broader market during that same time frame. Although SPR had significant growth over the past year, our hold rating indicates that we do not recommend additional investment in this stock at the current time.
- SPR's debt-to-equity ratio of 0.79 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.73 is weak.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Aerospace & Defense industry and the overall market, SPIRIT AEROSYSTEMS HOLDINGS's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has significantly decreased to $61.30 million or 80.15% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.