NEW YORK (TheStreet) -- Shares of Amira Nature Foods (ANFI) are jumping by 5.34% to $9.27 on heavy trading volume on Thursday afternoon, after the company renewed a contract with a key repeat customer yesterday.
The company entered into a $92 million contract to supply basmati rice from a third party to a customer in Europe, the Middle East and Africa, according to a 6-K form from the Securities and Exchange Commission.
The United Arab Emirates-based company is a provider of packaged Indian specialty rice and other related rice-based products, including snacks, ready-to-heat meals, organic product offerings, wheat, barley and legumes.
About 526,778 shares of Amira Nature Foods were traded by this afternoon, well above the company's average of 368,166 shares per day.
The document did not specify who the customer was.
Separately, recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate AMIRA NATURE FOODS LTD as a Sell with a ratings score of D+. This is driven by multiple 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 generally high debt management risk, poor profit margins and generally disappointing historical performance in the stock itself.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The debt-to-equity ratio of 1.10 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, ANFI has a quick ratio of 0.66, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
- The gross profit margin for AMIRA NATURE FOODS LTD is rather low; currently it is at 17.19%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 6.22% significantly trails the industry average.
- ANFI has underperformed the S&P 500 Index, declining 7.25% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
- The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Food Products industry average, but is greater than that of the S&P 500. The net income increased by 5.6% when compared to the same quarter one year prior, going from $13.37 million to $14.13 million.
- AMIRA NATURE FOODS LTD has improved earnings per share by 6.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. During the past fiscal year, AMIRA NATURE FOODS LTD increased its bottom line by earning $1.41 versus $1.05 in the prior year.
- You can view the full analysis from the report here: ANFI