Why Rentech (RTK) Is Crumbling on Tuesday

Updated from 2:21 p.m. to correct net loss in the same period a year earlier.

NEW YORK (TheStreet) -- Rentech Incorporated (RTK) is tumbling after posting a wider-than-expected net loss and disappointing revenue in the three months to December.

By late afternoon, shares had taken off 7.1% to $1.82.

The wood chips, pellets and nitrogen products supplier recorded a quarterly net loss of 6 cents a share, 2 cents wider than analysts surveyed by Thomson Reuters had forecast. Earnings improved year over year from a net loss of 11 cents in the year-ago quarter.

Revenue fell 14% year over year to $79.3 million. Analysts had anticipated total sales $10.4 million higher.

Over fiscal 2013, the Los Angeles-based business recorded a net loss of a penny a share compared to a net loss of 6 cents a share a year earlier. Revenue climbed 43% to $374.9 million. 

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TheStreet Ratings team rates RENTECH INC as a Sell with a ratings score of D+. The team has this to say about their recommendation:

"We rate RENTECH INC (RTK) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, poor profit margins, weak operating cash flow, generally high debt management risk and generally disappointing historical performance in the stock itself."

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