NEW YORK (TheStreet) — Commercial Vehicle Group (Nasdaq:CVGI) has been downgraded by TheStreet Ratings from hold to sell. The companys weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself, unimpressive growth in net income, weak operating cash flow, generally weak debt management and poor profit margins.
Highlights from the ratings report include:
- Despite any intermediate fluctuations, we have only bad news to report on this stocks performance over the last year: it has tumbled by 26.55%, worse than the Samp;P 500s performance. Consistent with the plunge in the stock price, the companys earnings per share are down 500.00% compared to the year-earlier quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
- 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 Samp;P 500 and the Machinery industry. The net income has significantly decreased by 413.0% when compared to the same quarter one year ago, falling from $0.69 million to -$2.17 million.
- Net operating cash flow has significantly decreased to $0.67 million or 97.73% when compared to the same quarter last year. In addition, when comparing to the industry average, the firms growth rate is much lower.
- The debt-to-equity ratio is very high at 48.90 and currently higher than the industry average, implying that there is very poor management of debt levels within the company. Regardless of the companys weak debt-to-equity ratio, CVGI has managed to keep a strong quick ratio of 1.93, which demonstrates the ability to cover short-term cash needs.
- The gross profit margin for COMMERCIAL VEHICLE GROUP INC is currently extremely low, coming in at 14.90%. Regardless of CVGIs low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of -1.00% trails the industry average.
Commercial Vehicle Group, Inc., together with its subsidiaries, designs and manufactures integrated system solutions for the commercial vehicle markets worldwide. The company has a P/E ratio of 26, below the average automotive industry P/E ratio of 27.1 and above the Samp;P 500 P/E ratio of 17.7. Commercial Vehicle Group has a market cap of $179.5 million and is part of the consumer goods sector and automotive industry. Shares are down 59.1% year to date as of the close of trading on Thursday.
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