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Bachoco Industries Stock Upgraded (IBA)

NEW YORK ( TheStreet) -- Bachoco Industries (NYSE: IBA) 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, good cash flow from operations, increase in net income and growth in earnings per share. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 24.9%. Since the same quarter one year prior, revenues rose by 43.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Although IBA's debt-to-equity ratio of 0.10 is very low, it is currently higher than that of the industry average. To add to this, IBA has a quick ratio of 1.57, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Food Products industry. The net income increased by 299.2% when compared to the same quarter one year prior, rising from $12.92 million to $51.59 million.
  • Net operating cash flow has significantly increased by 834.59% to $181.95 million when compared to the same quarter last year. In addition, INDUSTRIAS BACHOCO SAB DE CV has also vastly surpassed the industry average cash flow growth rate of -1073.86%.
  • INDUSTRIAS BACHOCO SAB DE CV reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, INDUSTRIAS BACHOCO SAB DE CV reported lower earnings of $0.23 versus $3.20 in the prior year.
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Industrias Bachoco, S.A.B. de C.V., through its subsidiaries, operates as a poultry producer in Mexico. It engages in breeding, processing, and marketing of chicken, eggs, swine, and balanced animal feed. The company also offers turkey and value-added beef and pork products. The company has a P/E ratio of 87.9, below the average food & beverage industry P/E ratio of 116.8 and above the S&P 500 P/E ratio of 17.7. Bachoco has a market cap of $1.05 billion and is part of the consumer goods sector and food & beverage industry. Shares are up 10.6% year to date as of the close of trading on Tuesday.

You can view the full Bachoco Ratings Report or get investment ideas from our investment research center.
-- Written by a member of TheStreet RatingsStaff

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