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"We rate UNWIRED PLANET INC (UPIP) a SELL. This is driven by a number of negative factors, 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 unimpressive growth in net income, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share."
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Highlights from the analysis by TheStreet Ratings Team goes as follows:
- 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 Internet Software & Services industry. The net income has significantly decreased by 68.6% when compared to the same quarter one year ago, falling from -$7.19 million to -$12.12 million.
- Net operating cash flow has significantly decreased to -$30.10 million or 386.64% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- In its most recent trading session, UPIP 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. 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.
- UNWIRED PLANET 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. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, UNWIRED PLANET INC continued to lose money by earning -$0.01 versus -$0.44 in the prior year. For the next year, the market is expecting a contraction of 2800.0% in earnings (-$0.29 versus -$0.01).
- 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 Internet Software & Services industry and the overall market, UNWIRED PLANET INC's return on equity significantly trails that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: UPIP Ratings Report