TheStreet.com Ratings provides exclusive stock, ETF and mutual fund recommendations using proprietary tools. Our "safety first" approach aims to reduce risk while achieving total return performance.
) -- The following companies are projected to increase revenue and profit by at least 12% in the coming year and receive "buy" ratings from our proprietary quantitative model, which considers more than 60 factors. They're ordered by their potential to appreciate, starting with the company with the best growth prospects.
is an Israeli company that develops generic and branded pharmaceuticals, biogenerics and active pharmaceutical ingredients.
: Second-quarter net income dropped 2% to $521 million and earnings per share fell 11% to 58 cents, hurt by a higher share count, as revenue ascended 20% to $3.4 billion. The operating margin increased from 23% to 24%, but the net margin dropped from 19% to 15%. A quick ratio of 0.9 indicates a less-than-ideal liquidity position. And a debt-to-equity ratio of 0.4 reflects a modest debt load.
: Teva is up 22% in 2009, beating the
Dow Jones Industrial Average
S&P 500 Index
. The stock trades at a price-to-earnings ratio of 54, indicating a significant premium to the market, and offers a modest 1.2% dividend yield.
sells software to automate business processes.
: Second-quarter net income surged 294% to $11.2 million and earnings per share increased 275% to 30 cents as revenue rose 25% to $64 million. The operating margin ascended from 5% to 18% and the net margin advanced from 6% to 18%. Pegasystems has an outstanding liquidity position, which is evident in its quick ratio of 3.9, and has no debt or interest expenses.
: Pegasystems has rocketed 136% in 2009, trouncing major U.S. indices. The stock trades at an exorbitant price-to-earnings ratio of 44 and offers a dividend yield below 1%. By comparison, companies in the S&P 500 Index pay an average dividend yield of 3.6%. Automation software reduces corporate expenses and therefore has recessionary appeal.
provides IT consulting to government agencies.
: Second-quarter net income rose 26% to $5.1 million and earnings per share rose 23% to 37 cents as revenue advanced 13% to $109 million. The operating margin widened to 8% and the net margin stretched from 4% to 5%. A quick ratio of 1.6 demonstrates NCI's ample liquidity. And a debt-to-equity ratio of 0.2 indicates modest leverage.
: NCI is flat in 2009, underperforming major U.S. indices. The stock trades at an expensive price-to-earnings ratio of 22 and doesn't pay dividends. As the federal government seeks to reduce budget deficits and trim spending, NCI's services will be in demand.
is a for-profit post-secondary education company.
: Second-quarter net income climbed 29% to $28 million and earnings per share jumped 33% to $2 as revenue increased 29% to $126 million. The operating margin climbed from 34% to 36% and the net margin remained steady at 22%. Strayer has no debt or interest expenses. And a quick ratio of 1.6 indicates ample liquidity.
: Strayer is up 2% in 2009, less than major U.S. indices. The stock trades at an expensive price-to-earnings ratio of 33 and offers a dividend yield below 1%.
( MVL) publishes comic books and films based on its proprietary library of superhero characters.
: Second-quarter earnings dropped 38% to $29 million, or 37 cents a share, as revenue declined 26% to $116 million. The operating margin decreased from 54% to 42% and the net margin fell from 30% to 25%. Marvel has an admirable financial position, with $119 million of cash reserves and zero debt.
: Marvel has jumped 25% in 2009, outpacing the Dow and S&P 500. The stock trades at a fair price-to-earnings ratio of 16, but doesn't pay dividends.
TSC Ratings was given an award this year for "Best Stock Selection" among independent research providers by BNY ConvergEx Group. A rating can be viewed for any stock through our
. Ratings are derived from a variety of fundamental and pricing figures and represent our opinion of risk-adjusted performance. However, the rating doesn't incorporate all factors that can alter a stock's performance.
-- Reported by Jake Lynch in Boston.