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NEW YORK (TheStreet) -- Heartware International (HTWR) has been downgraded by TheStreet Ratings from Hold to Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
"We rate HEARTWARE INTERNATIONAL INC (HTWR) a SELL. This is driven by a few notable 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 relatively poor performance when compared with the S&P 500 during the past year."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- In its most recent trading session, HTWR has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.
- 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 Health Care Equipment & Supplies industry and the overall market, HEARTWARE INTERNATIONAL INC's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for HEARTWARE INTERNATIONAL INC is rather high; currently it is at 66.51%. Regardless of HTWR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, HTWR's net profit margin of -10.74% significantly underperformed when compared to the industry average.
- Despite currently having a low debt-to-equity ratio of 0.56, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 4.07 is very high and demonstrates very strong liquidity.
- HEARTWARE INTERNATIONAL INC has improved earnings per share by 37.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, HEARTWARE INTERNATIONAL INC continued to lose money by earning -$3.68 versus -$6.15 in the prior year. This year, the market expects an improvement in earnings (-$2.24 versus -$3.68).
- You can view the full analysis from the report here: HTWR Ratings Report