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NEW YORK (TheStreet) -- Ultrapar Participacoes (UGP) has been downgraded by TheStreet Ratings from Buy to Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
TheStreet Ratings team rates ULTRAPAR PARTICIPACOES SA as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate ULTRAPAR PARTICIPACOES SA (UGP) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. Among the primary strengths of the company is its reasonable valuation levels, considering its current price compared to earnings, book value and other measures. At the same time, however, we also find weaknesses including deteriorating net income, poor profit margins and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- UGP, with its decline in revenue, underperformed when compared the industry average of 6.7%. Since the same quarter one year prior, revenues fell by 21.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- ULTRAPAR PARTICIPACOES SA's earnings per share declined by 29.6% in the most recent quarter compared to 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, ULTRAPAR PARTICIPACOES SA increased its bottom line by earning $0.96 versus $0.91 in the prior year. For the next year, the market is expecting a contraction of 2.1% in earnings ($0.94 versus $0.96).
- Net operating cash flow has declined marginally to $334.79 million or 4.73% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, ULTRAPAR PARTICIPACOES SA has marginally lower results.
- 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 25.4% when compared to the same quarter one year ago, falling from $145.37 million to $108.38 million.
- You can view the full analysis from the report here: UGP Ratings Report