American Woodmark Corporation Stock Upgraded (AMWD)
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) -- American Woodmark Corporation (Nasdaq:AMWD) 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, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company shows low profit margins.
- The revenue growth came in higher than the industry average of 3.2%. Since the same quarter one year prior, revenues rose by 25.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- AMWD's debt-to-equity ratio is very low at 0.17 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, AMWD has a quick ratio of 1.97, which demonstrates the ability of the company to cover short-term liquidity needs.
- AMERICAN WOODMARK CORP reported significant earnings per share improvement 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, AMERICAN WOODMARK CORP turned its bottom line around by earning $0.65 versus -$1.45 in the prior year. This year, the market expects an improvement in earnings ($1.50 versus $0.65).
- Net operating cash flow has significantly increased by 732.04% to $21.89 million when compared to the same quarter last year. In addition, AMERICAN WOODMARK CORP has also vastly surpassed the industry average cash flow growth rate of -29.82%.
- Powered by its strong earnings growth of 180.95% and other important driving factors, this stock has surged by 107.84% over the past year, outperforming the rise in the S&P 500 Index during the same period. Looking ahead, the stock's sharp 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 other strengths this company displays justify these higher price levels.
-- Written by a member of TheStreet Ratings Staff
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. 3x UPSIDE POTENTIAL: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more..
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