Why RTI International Metals (RTI) Stock Is Lower Today

NEW YORK (TheStreet) -- Shares of RTI International Metals Inc. (RTI) are lower -2.88% to $26.67 on Tuesday after the company reported a decline in revenue and income for the 2014 first quarter.

The company reported revenue totaled $174.5 million, compared to $189.2 million from the 2013 first quarter.

RTI International said the net loss attributable to continuing operations was -$3.8 million, or -13 cents per dilutes share, compared to the same quarter last year when the company reported net income was $5.0 million, or 16 cents per diluted share.

Operating income was $1.6 million for the 2014 first quarter versus $13.6 million from the same period last year.

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The company is a global producer and supplier of advanced titanium mill products and a manufacturer of fabricated titanium and specialty metal components for defense, aerospace, energy and consumer markets.

TheStreet Ratings team rates RTI INTL METALS INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

"We rate RTI INTL METALS INC (RTI) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels 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, weak operating cash flow and poor profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • RTI's revenue growth has slightly outpaced the industry average of 7.5%. Since the same quarter one year prior, revenues slightly increased by 7.7%. 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.
  • Despite currently having a low debt-to-equity ratio of 0.56, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 3.04 is very high and demonstrates very strong liquidity.
  • Net operating cash flow has significantly decreased to $5.83 million or 83.02% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Metals & Mining industry. The net income has significantly decreased by 157.5% when compared to the same quarter one year ago, falling from $6.56 million to -$3.78 million.
  • You can view the full analysis from the report here: RTI Ratings Report
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