NEW YORK (TheStreet) -- Natures Sunshine Products (Nasdaq:NATR) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity. Highlights from the ratings report include:
- The gross profit margin for NATURES SUNSHINE PRODS INC is currently very high, coming in at 81.20%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 7.10% is above that of the industry average.
- NATR has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.03, which illustrates the ability to avoid short-term cash problems.
- Despite its growing revenue, the company underperformed as compared with the industry average of 9.7%. Since the same quarter one year prior, revenues slightly increased by 7.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- NATURES SUNSHINE PRODS INC has improved earnings per share by 38.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, NATURES SUNSHINE PRODS INC increased its bottom line by earning $0.55 versus $0.43 in the prior year. This year, the market expects an improvement in earnings ($1.15 versus $0.55).
- Powered by its strong earnings growth of 38.70% and other important driving factors, this stock has surged by 60.07% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, NATR should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
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