SOME REALLY BAD NEWS !!! GOLDMAN SAYS SELL !!!
ByLaurie KulikowskiFollow | 10/15/15 - 08:57 AM EDT
4. Westport Innovations Inc. (WPRT)
Industry: Industrials/Construction & Farm Machinery & Heavy Trucks
Market Cap: $241 million
Year-to-date return: -44%
Expected 2016 Net Debt/EBITDA (earnings before interest, taxes, depreciation and amortization): n/a
Goldman Sachs Rating/Price Target: Sell/$3
Downside to Goldman Sachs' Price Target: -23%
TheStreet Said: TheStreet Ratings team rates WESTPORT INNOVATIONS INC as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
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We rate WESTPORT INNOVATIONS INC (WPRT) 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 disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
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 Machinery industry and the overall market, WESTPORT INNOVATIONS INC's return on equity significantly trails that of both the industry average and the S&P 500.
The gross profit margin for WESTPORT INNOVATIONS INC is currently lower than what is desirable, coming in at 34.97%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -73.57% is significantly below that of the industry average.
WPRT'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 48.89%, 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.
