NeuStar (NYSE: NSR) is rated at BUY with a grade of A. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, growth in earnings per share, increase in net income and expanding profit margins. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
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Highlights from the ratings report include:
- The gross profit margin for NEUSTAR INC is currently very high, coming in at 78.10%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 21.66% is above that of the industry average.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the IT Services industry. The net income increased by 21.1% when compared to the same quarter one year prior, going from $37.77 million to $45.75 million.
- NEUSTAR INC has improved earnings per share by 33.3% 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, NEUSTAR INC increased its bottom line by earning $1.66 versus $1.64 in the prior year. This year, the market expects an improvement in earnings ($3.01 versus $1.66).
- Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. 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.
NeuStar, Inc. provides technology and directory services to its communications service provider (carrier) and non-carrier, commercial business customers worldwide. The company operates in three segments: Carrier Services, Enterprise Services, and Information Services.You can view the full NeuStar Ratings Report or get investment ideas from our investment research center. This is just a list of 5 of 50 stocks! Download a list of all 50 of TheStreet Ratings Tech Picks for 2013 NOW! 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.
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