Brunswick Corp. stock was upgraded by The Street Ratings from sell to hold.
“The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings-per-share growth and compelling growth in net income,” according to The Street website. “However, as a counter to these strengths, we also find weaknesses, including weak operating cash flow, generally poor debt management and poor profit margins.”
Highlights from the ratings report include:
• Net operating cash flow has significantly decreased to -$83.10 million, or 395.72 percent when compared to the same quarter last year. In addition, when comparing to the industry average, the company’s growth rate is much lower.
• The debt-to-equity ratio is very high at 6.58 and currently higher than the industry average, implying that there is very poor management of debt levels within the company. Even though the debt-to-equity ratio is weak, Brunswick’s quick ratio is somewhat strong at 1.01, demonstrating the ability to handle short-term liquidity needs.
• Compared to where it was 12 months ago the stock is up, but it has so far lagged the appreciation in the S&P 500. Despite the fact that it has risen in the last year, there is currently no conclusive evidence that warrants the purchase or sale of the stock.
Brunswick’s stock closed Wednesday at $17.82 a share. Its 52-week high and low are $27.70 and $11.72.