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) -- Retractable Technologies (AMEX: RVP) has been downgraded by TheStreet Ratings from hold to sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and weak operating cash flow.
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- RETRACTABLE TECHNOLOGIES INC's earnings per share declined by 33.3% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, RETRACTABLE TECHNOLOGIES INC reported poor results of -$0.26 versus -$0.19 in the prior year.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Health Care Equipment & Supplies industry. The net income has significantly decreased by 44.5% when compared to the same quarter one year ago, falling from -$1.41 million to -$2.04 million.
- 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 Health Care Equipment & Supplies industry and the overall market, RETRACTABLE TECHNOLOGIES INC's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for RETRACTABLE TECHNOLOGIES INC is currently lower than what is desirable, coming in at 33.94%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -33.74% is significantly below that of the industry average.
- Net operating cash flow has decreased to -$2.66 million or 24.78% 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.