NEW YORK (TheStreet) -- Huron Consulting Group (Nasdaq:HURN) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
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- The current debt-to-equity ratio, 0.52, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, HURN has a quick ratio of 1.55, which demonstrates the ability of the company to cover short-term liquidity needs.
- Net operating cash flow has increased to $41.07 million or 15.88% when compared to the same quarter last year. In addition, HURON CONSULTING GROUP INC has also modestly surpassed the industry average cash flow growth rate of 11.01%.
- HURON CONSULTING GROUP INC's earnings per share declined by 34.9% in the most recent quarter compared to the same quarter a year ago. 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, HURON CONSULTING GROUP INC increased its bottom line by earning $0.95 versus $0.60 in the prior year. This year, the market expects an improvement in earnings ($2.30 versus $0.95).
- Despite the weak revenue results, HURN has outperformed against the industry average of 15.1%. Since the same quarter one year prior, revenues slightly dropped by 4.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- In its most recent trading session, HURN has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. 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.
-- 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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