Liberty Media Corp. Interactive Shs Stock Upgraded (LSTZA)

NEW YORK (TheStreet) -- Liberty Media Corp. Interactive Shs (Nasdaq:LSTZA) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, increase in net income, robust revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:

• LIBERTY MEDIA STARZ GROUP has improved earnings per share by 25.0% 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, LIBERTY MEDIA STARZ GROUP increased its bottom line by earning $3.99 versus $0.22 in the prior year. This year, the market expects an improvement in earnings ($4.65 versus $3.99).
• The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Media industry average. The net income increased by 27.1% when compared to the same quarter one year prior, rising from $48.00 million to $61.00 million.
• Despite its growing revenue, the company underperformed as compared with the industry average of 22.8%. Since the same quarter one year prior, revenues rose by 21.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
• LSTZA's debt-to-equity ratio is very low at 0.02 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 10.18, which clearly demonstrates the ability to cover short-term cash needs.
• 41.90% is the gross profit margin for LIBERTY MEDIA STARZ GROUP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 15.70% is above that of the industry average.

Liberty Starz Group, through its subsidiary, Starz, LLC, focuses primarily on video programming businesses in the United States. The company has a P/E ratio of 17.2, above the average media industry P/E ratio of 4.3 and below the S&P 500 P/E ratio of 17.7. Liberty Media Corp. Interactive Shs has a market cap of $3.4 billion and is part of the services sector and media industry. Shares are down 2.3% year to date as of the close of trading on Thursday.

You can view the full Liberty Media Corp. Interactive Shs Ratings Report or get investment ideas from our investment research center.

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