Editor's Note: 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.NEW YORK (TheStreet) -- HollyFrontier (NYSE:HFC) has been reiterated by TheStreet Ratings as a buy with a ratings score of A . The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth and increase in net income. We feel these strengths outweigh the fact that the company shows low profit margins.
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- HFC's revenue growth has slightly outpaced the industry average of 3.2%. Since the same quarter one year prior, revenues slightly increased by 0.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- HOLLYFRONTIER CORP has improved earnings per share by 18.5% 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. During the past fiscal year, HOLLYFRONTIER CORP increased its bottom line by earning $6.12 versus $0.97 in the prior year. This year, the market expects an improvement in earnings ($7.81 versus $6.12).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 14.8% when compared to the same quarter one year prior, going from $523.09 million to $600.37 million.
- The gross profit margin for HOLLYFRONTIER CORP is rather low; currently it is at 20.60%. Regardless of HFC's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, HFC's net profit margin of 11.50% compares favorably to the industry average.
--Written by a member of TheStreet Ratings Staff.FREE for a limited time only: Get TheStreet Ratings #1 Stock Report NOW!
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