- OI SA's earnings per share declined by 50.0% in the most recent quarter compared to the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, OI SA reported lower earnings of $0.39 versus $0.79 in the prior year. For the next year, the market is expecting a contraction of 105.1% in earnings (-$0.02 versus $0.39).
- 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 Diversified Telecommunication Services industry. The net income has significantly decreased by 45.6% when compared to the same quarter one year ago, falling from -$67.24 million to -$97.89 million.
- Although OIBR's debt-to-equity ratio of 2.15 is very high, it is currently less than that of the industry average. Along with the unfavorable debt-to-equity ratio, OIBR maintains a poor quick ratio of 0.89, which illustrates the inability to avoid short-term cash problems.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. In comparison to the other companies in the Diversified Telecommunication Services industry and the overall market, OI SA's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 57.60%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 50.00% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
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. The Telecommunications industry as a whole closed the day up 0.4% versus the S&P 500, which was down 0.1%. Laggards within the Telecommunications industry included Otelco ( OTEL), down 2.2%, Voltari ( VLTC), down 1.9%, Ikanos Communications ( IKAN), down 12.5%, Hong Kong Television Network ( HKTV), down 3.3% and Communications Systems ( JCS), down 1.6%. TheStreet Ratings Group would like to highlight 3 stocks that pushed the industry lower today: Oi ( OIBR) is one of the companies that pushed the Telecommunications industry lower today. Oi was down $0.03 (4.2%) to $0.64 on light volume. Throughout the day, 11,759,833 shares of Oi exchanged hands as compared to its average daily volume of 16,271,200 shares. The stock ranged in price between $0.62-$0.65 after having opened the day at $0.62 as compared to the previous trading day's close of $0.67. Oi S.A., through its subsidiaries, provides integrated telecommunication services for residential customers, companies, and governmental agencies in Brazil. It operates in three segments: Fixed-Line and Data Transmission Services, Mobile Services, and Other Services. Oi has a market cap of $5.6 billion and is part of the technology sector. Shares are down 57.9% year-to-date as of the close of trading on Friday. Currently there is 1 analyst who rates Oi a buy, 1 analyst rates it a sell, and 1 rates it a hold. STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more. TheStreet Ratings rates Oi as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, unimpressive growth in net income, generally high debt management risk, disappointing return on equity and generally disappointing historical performance in the stock itself. Highlights from TheStreet Ratings analysis on OIBR go as follows: