NEW YORK (TheStreet) -- Shares of Quiksilver (ZQK) were falling 14.4% to $1.93 Friday after the apparel company ousted CEO Andy Mooney.

The teen apparel company said that Mooney is no longer with the company, and that company president Pierre Agnes has been promoted to CEO. Agnes was also added to the company's board of directors.

Agnes has worked for Quiksilver for 27 years and previously served as Global Head of Apparel for the Quiksilver, Roxy, and DC brands, and as President of Quiksilver Europe.

"The board has great confidence in Pierre's ability and skills to lead our company," Founder and Chairman of Quiksilver Bob McKnight said in a statement. "His primary focus will be on improving operational execution and efficiencies, and identifying growth opportunities, especially in the U.S. wholesale channel."

The ousting comes after the company reduced its guidance for the year and completed an investigation into its revenue-accounting practices, according to the Wall Street Journal.

TheStreet Ratings team rates QUIKSILVER INC as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:

"We rate QUIKSILVER INC (ZQK) a SELL. This is driven by some concerns, 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 deteriorating net income, disappointing return on equity, generally disappointing historical performance in the stock itself and generally high debt management risk."

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 Textiles, Apparel & Luxury Goods industry. The net income has significantly decreased by 166.5% when compared to the same quarter one year ago, falling from $16.19 million to -$10.77 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Textiles, Apparel & Luxury Goods industry and the overall market, QUIKSILVER INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The debt-to-equity ratio is very high at 30.17 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, ZQK's quick ratio is somewhat strong at 1.13, demonstrating the ability to handle short-term liquidity needs.
  • ZQK's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 74.73%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • ZQK, with its decline in revenue, underperformed when compared the industry average of 13.6%. Since the same quarter one year prior, revenues fell by 13.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • You can view the full analysis from the report here: ZQK Ratings Report