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The following ratings changes were generated on June 23.
(IHS - Get Report)
-- which provides critical information and decision-support tools to customers in the energy, defense, aerospace, construction and electronics industries -- has been upgraded to buy. IHS' revenue growth has slightly outpaced the industry average of 27%. Quarterly revenue grew 34% over a year ago. During the past fiscal year, IHS increased its bottom line by earning $1.39 a share vs. $1.03 in the prior year. This year, the market expects an improvement in earnings ($1.93 vs. $1.39).
Its net income increased by 25% when compared to the same quarter one year prior, rising from $18.58 million to $23.26 million. Net operating cash flow has increased to $62.49 million, or 46% when compared with the same quarter last year. In addition, IHS has also modestly surpassed the industry average cash-flow growth rate of 40%.
We feel that the stock's sharp appreciation over the last year has driven it to a price level that is now somewhat expensive compared with the rest of its industry. The other strengths this company shows, however, justify the higher price levels. IHS had been rated a hold since May 2008.