NEW YORK (TheStreet) -- Digital Ally (DGLY) shares are up 17.9% to $27.17 on Thursday as calls for police officers to wear body cameras similar to the ones the company manufactures have grown over the past few weeks.
The calls for the use of the cameras have increased in the aftermath of a police shooting involving an unarmed teen in Ferguson, MO.
A White House petition calling for legislation requiring police to wear the cameras has received over 147,000 signatures and the state of Michigan recently made a $1.1 million order for Digital Ally's cameras.
TheStreet Ratings team rates DIGITAL ALLY INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate DIGITAL ALLY INC (DGLY) 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 feeble growth in its earnings per share, deteriorating net income, disappointing return on equity and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- DIGITAL ALLY INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern earnings per share over the past two years. During the past fiscal year, DIGITAL ALLY INC reported poor results of -$1.14 versus -$0.99 in the prior year.
- 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 Electronic Equipment, Instruments & Components industry. The net income has significantly decreased by 864.0% when compared to the same quarter one year ago, falling from $0.11 million to -$0.87 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 Electronic Equipment, Instruments & Components industry and the overall market, DIGITAL ALLY INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has significantly decreased to -$0.75 million or 493.70% 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 DIGITAL ALLY INC is rather high; currently it is at 62.33%. Regardless of DGLY's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, DGLY's net profit margin of -22.28% significantly underperformed when compared to the industry average.
- You can view the full analysis from the report here: DGLY Ratings Report