Goldcorp Inc Stock Upgraded (GG)

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) -- Goldcorp (NYSE: GG) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and a generally disappointing performance in the stock itself.

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Highlights from the ratings report include:
  • GG's revenue growth has slightly outpaced the industry average of 4.0%. Since the same quarter one year prior, revenues slightly increased by 5.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 44.15% is the gross profit margin for GOLDCORP INC which we consider to be strong. It has increased significantly from the same period last year. Along with this, the net profit margin of 19.97% is above that of the industry average.
  • GG's debt-to-equity ratio is very low at 0.17 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.91 is somewhat weak and could be cause for future problems.
  • GG has underperformed the S&P 500 Index, declining 8.54% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, GOLDCORP INC underperformed against that of the industry average and is significantly less than that of the S&P 500.

Goldcorp Inc. is engaged in the acquisition, exploration, development, and operation of precious metal properties in Canada, the United States, Mexico, and Central and South America. Goldcorp has a market cap of $23.25 billion and is part of the basic materials sector and metals & mining industry. Shares are up 31.9% year to date as of the close of trading on Tuesday.

You can view the full Goldcorp Ratings Report or get investment ideas from our investment research center.

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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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