TSC Ratings' Updates: Allergan

AGN had been rated a hold since May 27, 2008.

O'Reilly Auto(ORLY Quote) has been upgraded from hold to buy. O'Reilly Automotive operates as a specialty retailer of automotive aftermarket parts, tools, supplies, equipment, and accessories in the U.S. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income, expanding profit margins, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has posted a somewhat disappointing return on equity.

The revenue growth came in higher than the industry average of 9.3%. Since the same quarter one year prior, revenue has slightly increased by 9.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.

The gross profit marging of 48.10% for ORLY we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 7.90% is above that of the industry average.

Net operating cash flow has significantly increased by 52.63% to $96.61 million when compared with the same quarter last year. In addition, ORLY has also vastly surpassed the industry average cash flow growth rate of -20.05%.

The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the specialty retail industry. The net income increased by 7.5% when compared with the same quarter one year prior, going from $51.90 million to $55.79 million.