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) -- Opko Health (NYSE: OPK) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and feeble growth in the company's earnings per share.
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- Compared to its closing price of one year ago, OPK's share price has jumped by 29.21%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- OPK's debt-to-equity ratio is very low at 0.29 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, OPK has a quick ratio of 2.11, which demonstrates the ability of the company to cover short-term liquidity needs.
- 48.05% is the gross profit margin for OPKO HEALTH INC which we consider to be strong. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, OPK's net profit margin of -200.01% significantly underperformed when compared to the industry average.
- 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 Biotechnology industry. The net income has significantly decreased by 30.2% when compared to the same quarter one year ago, falling from -$34.22 million to -$44.55 million.
- Net operating cash flow has significantly decreased to -$29.05 million or 96.98% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.