NEW YORK (TheStreet) -- InterCloud Systems (ICLD) stock is soaring 17.96% to $2.43 on heavy trading volume after the company today announced that it was awarded $2.3 million in next-generation WiFi and DAS network projects.
The new contracts were from existing and new clients, however InterCloud provided no details. The company did note that the expected completion dates of the projects would be between the third quarter and fourth quarter of 2015.
"Our management team remains focused on continuing to build a portfolio of next-generation IT services that will keep InterCloud competitive over the next several years as the IT industry continues to build momentum in cloud and managed services," CEO Mark Munro stated.
About 7.7 million shares of InterCloud Systems were traded by 1:05 p.m., above the company's trading volume of about 3 million shares a day.
The Shrewbury, NJ-based company provides IT and network solutions to the telecommunications service provider and corporate enterprise markets through cloud platforms and professional services.
Separately, TheStreet Ratings team rates INTERCLOUD SYSTEMS INC as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
"We rate INTERCLOUD SYSTEMS INC (ICLD) a SELL. This is driven by several weaknesses, 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 IT Services industry. The net income has significantly decreased by 200.1% when compared to the same quarter one year ago, falling from $10.35 million to -$10.35 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 IT Services industry and the overall market, INTERCLOUD SYSTEMS INC's return on equity significantly trails that of both the industry average and the S&P 500.
- Despite the current debt-to-equity ratio of 1.60, it is still below the industry average, suggesting that this level of debt is acceptable within the IT Services industry. Despite the fact that ICLD's debt-to-equity ratio is mixed in its results, the company's quick ratio of 0.65 is low and demonstrates weak liquidity.
- ICLD'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 57.71%, 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.
- 35.13% is the gross profit margin for INTERCLOUD SYSTEMS INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -49.32% is in-line with the industry average.
- You can view the full analysis from the report here: ICLD Ratings Report