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"We rate PLANET PAYMENT INC (PLPM) a SELL. This is driven by multiple 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 area that we feel has been the company's primary weakness has been its generally disappointing historical performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- This stock's share value has moved by only 37.74% over the past year. 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.
- 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 IT Services industry and the overall market, PLANET PAYMENT INC's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for PLANET PAYMENT INC is rather high; currently it is at 55.31%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 12.69% trails the industry average.
- Net operating cash flow has significantly increased by 319.33% to $1.89 million when compared to the same quarter last year. In addition, PLANET PAYMENT INC has also vastly surpassed the industry average cash flow growth rate of -1.88%.
- PLPM's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, PLPM has a quick ratio of 2.11, which demonstrates the ability of the company to cover short-term liquidity needs.
- You can view the full analysis from the report here: PLPM Ratings Report