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NEW YORK (TheStreet) -- Kate Spade (KATE) has been upgraded by TheStreet Ratings from Hold to Buy with a ratings score of B.  TheStreet Ratings Team has this to say about their recommendation:

TheStreet Ratings team rates KATE SPADE & CO as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate KATE SPADE & CO (KATE) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its notable return on equity, robust revenue growth, impressive record of earnings per share growth and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

• Compared to other companies in the Textiles, Apparel & Luxury Goods industry and the overall market, KATE SPADE & CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
• The revenue growth came in higher than the industry average of 18.1%. Since the same quarter one year prior, revenues rose by 44.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
• KATE SPADE & CO 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, KATE SPADE & CO turned its bottom line around by earning $0.59 versus -$0.29 in the prior year. This year, the market expects an improvement in earnings ($0.61 versus $0.59).
• The gross profit margin for KATE SPADE & CO is rather high; currently it is at 57.76%. Regardless of KATE's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, KATE's net profit margin of 31.74% significantly outperformed against the industry.
• The debt-to-equity ratio is very high at 2.06 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, KATE's quick ratio is somewhat strong at 1.08, demonstrating the ability to handle short-term liquidity needs.
• You can view the full analysis from the report here: KATE Ratings Report