NEW YORK (TheStreet) -- Dresser-Rand Group (NYSE:DRC) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in net income, good cash flow from operations and notable return on equity. We feel these strengths outweigh the fact that the company has had generally poor debt management on most measures that we evaluated.
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- DRC's very impressive revenue growth greatly exceeded the industry average of 12.4%. Since the same quarter one year prior, revenues leaped by 86.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Energy Equipment & Services industry. The net income increased by 5800.0% when compared to the same quarter one year prior, rising from $0.40 million to $23.60 million.
- Net operating cash flow has significantly increased by 320.00% to $9.90 million when compared to the same quarter last year. In addition, DRESSER-RAND GROUP INC has also vastly surpassed the industry average cash flow growth rate of -44.70%.
- DRESSER-RAND GROUP INC has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, DRESSER-RAND GROUP INC reported lower earnings of $1.55 versus $1.80 in the prior year. This year, the market expects an improvement in earnings ($2.83 versus $1.55).
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Energy Equipment & Services industry and the overall market, DRESSER-RAND GROUP INC's return on equity exceeds that of both the industry average and the S&P 500.
-- Written by a member of TheStreet Ratings Staff
TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
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