NEW YORK (TheStreet) -- Quantum Fuel Systems Technologies (QTWW) stock is gaining Tuesday after the company announced it had received a large order for a lightweight back-of-cab natural gas storage system from Dillon Transport. By early afternoon, shares had spiked 25% to $5.40.
"We are excited about adding Dillon Transport as a customer and recognize them as an industry leader with strong commercialization interests in natural gas trucks," Quantum CEO Brian Olson said in a statement.
"We selected Quantum's highly innovative Back-of-Cab storage system due to the weight savings and the cost-effective aspect of this system," added Dillon Transport president Jeff Dillon.
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Separately, TheStreet Ratings team rates QUANTUM FUEL SYS TECH WORLDW as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
"We rate QUANTUM FUEL SYS TECH WORLDW (QTWW) a SELL. This is driven by several 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 weak operating cash flow and poor profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Net operating cash flow has significantly decreased to -$3.58 million or 68.72% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- The gross profit margin for QUANTUM FUEL SYS TECH WORLDW is currently lower than what is desirable, coming in at 34.58%. Regardless of QTWW's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, QTWW's net profit margin of -40.25% significantly underperformed when compared to the industry average.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Auto Components industry and the overall market, QUANTUM FUEL SYS TECH WORLDW's return on equity significantly trails that of both the industry average and the S&P 500.
- QTWW's debt-to-equity ratio is very low at 0.22 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, QTWW has a quick ratio of 1.85, which demonstrates the ability of the company to cover short-term liquidity needs.
- This stock has increased by 88.13% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the future course of this stock, we feel that the risks involved in investing in QTWW do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
- You can view the full analysis from the report here: QTWW Ratings Report