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"We rate AMPCO-PITTSBURGH CORP (AP) 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, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, poor profit margins and a generally disappointing performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Despite its growing revenue, the company underperformed as compared with the industry average of 3.5%. Since the same quarter one year prior, revenues slightly increased by 1.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- AP's debt-to-equity ratio is very low at 0.06 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, AP has a quick ratio of 1.96, which demonstrates the ability of the company to cover short-term liquidity needs.
- AMPCO-PITTSBURGH CORP 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 not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, AMPCO-PITTSBURGH CORP increased its bottom line by earning $1.20 versus $0.81 in the prior year.
- The gross profit margin for AMPCO-PITTSBURGH CORP is rather low; currently it is at 18.60%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -0.52% is significantly below that of the industry average.
- 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 Metals & Mining industry. The net income has significantly decreased by 102.7% when compared to the same quarter one year ago, falling from $12.71 million to -$0.34 million.
- You can view the full analysis from the report here: AP Ratings Report