NEW YORK (TheStreet) -- AMN Healthcare Services (NYSE:AHS) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, revenue growth and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, unimpressive growth in net income and generally poor debt management. Highlights from the ratings report include:
- AMN HEALTHCARE SERVICES INC 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 two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, AMN HEALTHCARE SERVICES INC turned its bottom line around by earning $0.11 versus -$1.49 in the prior year. This year, the market expects an improvement in earnings ($0.27 versus $0.11).
- Despite its growing revenue, the company underperformed as compared with the industry average of 10.1%. Since the same quarter one year prior, revenues slightly increased by 0.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Health Care Providers & Services industry. The net income has significantly decreased by 50.5% when compared to the same quarter one year ago, falling from -$1.62 million to -$2.44 million.
- AHS's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 25.95%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
-- Written by a member of TheStreet RatingsStaff
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