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NEW YORK (TheStreet) -- Ladenburg Thalmann Financial Services (LTS) 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:
"We rate LADENBURG THALMANN FINL SERV (LTS) 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. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income and notable return on equity. However, as a counter to these strengths, we also find weaknesses including poor profit margins and weak operating cash flow."
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Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 1.1%. Since the same quarter one year prior, revenues rose by 11.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- LADENBURG THALMANN FINL SERV has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, LADENBURG THALMANN FINL SERV continued to lose money by earning -$0.04 versus -$0.09 in the prior year. This year, the market expects an improvement in earnings ($0.02 versus -$0.04).
- Net operating cash flow has significantly decreased to -$9.85 million or 163.71% when compared to the same quarter last year. Despite a decrease in cash flow LADENBURG THALMANN FINL SERV is still fairing well by exceeding its industry average cash flow growth rate of -184.61%.
- The gross profit margin for LADENBURG THALMANN FINL SERV is currently extremely low, coming in at 3.08%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 5.72% significantly trails the industry average.
- You can view the full analysis from the report here: LTS Ratings Report