LSI Corporation Stock Upgraded (LSI)

NEW YORK (TheStreet) -- LSI Corporation (NYSE:LSI) 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, growth in earnings per share, compelling growth in net income 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:

• LSI's revenue growth has slightly outpaced the industry average of 17.2%. Since the same quarter one year prior, revenues rose by 20.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
• LSI 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. To add to this, LSI has a quick ratio of 2.43, which demonstrates the ability of the company to cover short-term liquidity needs.
• LSI CORP reported significant earnings per share improvement 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 year. We feel that this trend should continue. During the past fiscal year, LSI CORP turned its bottom line around by earning $0.02 versus -$0.07 in the prior year. This year, the market expects an improvement in earnings ($0.44 versus $0.02).
• The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry average. The net income increased by 25.3% when compared to the same quarter one year prior, rising from $23.42 million to $29.34 million.
• Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.

LSI Corporation designs, develops, and markets storage and networking semiconductors and storage systems worldwide. The company has a P/E ratio of 41.9, above the average electronics industry P/E ratio of 11.2 and above the S&P 500 P/E ratio of 17.7. LSI has a market cap of $3.4 billion and is part of the technology sector and electronics industry. Shares are up 4.8% year to date as of the close of trading on Tuesday.

You can view the full LSI Ratings Report or get investment ideas from our investment research center.

For more information on LSI Corporation click any of the following:

• LSI Corporation Stock Price

• LSI Corporation Analyst Ratings

• LSI Corporation Key Stats & Profile

• LSI Corporation Earnings

• LSI Corporation Ratio Comparison

• LSI Corporation Growth Rates

• LSI Corporation Balance Sheet

• LSI Corporation Cash Flow

• LSI Corporation Income Statement