TSC Ratings TheStreet.com Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.
Each business day, we compile a list of the top five stocks in five categories -- fast-growth, all-around value, large-cap, mid-cap and small-cap -- and publish these lists in the Ratings section of our website.
Today, fast-growth stocks are in the spotlight. These are stocks of companies that are projected to increase revenue and profit by at least 12% in the coming year and rank near the top all stocks rated by our proprietary quantitative model, which looks at over 60 factors.
In addition, the stocks must be followed by at least one financial analyst who posts estimates on the Institutional Brokers' Estimate System. Please note that definitions of revenue vary by industry, and this screen does not make adjustments for acquisitions, which can materially affect posted results. Likewise, earnings-per-share growth may be affected by accounting charges, share repurchases and other one-time items.
Note that no provision is made for off-balance-sheet assets such as unrealized appreciation/depreciation of investments, market value of real estate or contingent liabilities that might affect book value. This could be material for some companies with large underfunded pension plans.
develops and markets healthcare information systems that automate medical and dental practices, networks of practices such as physician hospital organizations, ambulatory care centers, community health centers, and medical and dental schools. We have
since November 2001 due to its efficiency, solvency, and growth in revenue, net income and EPS. Solid stock price performance also supports this rating.
For the third quarter of fiscal 2009, the company reported that its revenues rose 36.1% year over year. The company announced that its net revenue results were a record for the company. A 15% improvement in EPS implies that the revenue growth trickled down to the bottom line. The company has achieved positive EPS growth routinely over the past two years, and we feel that this trend should continue. Net income also increased in the third quarter, rising 17.3% from $11.21 million to $13.15 million. Quality Systems has no debt to speak of, giving it a debt-to-equity ratio of zero. We consider this a favorable sign, as is a quick ratio of 2.02, which demonstrates the company's ability to cover its short-term liquidity needs.
Quality Systems' stock has risen over the past year, reflecting the earnings growth and other positive factors like the ones cited above. Although this increase has driven to the stock to a level that is somewhat expensive to the rest of the software industry, we feel that the company's strengths justify the higher price level at this time.
provides integrated information management solutions and services for local governments in the United States, Canada, Puerto Rico, and the United Kingdom. It has been
since July 2005 because of its efficiency, solvency, expanding profit margins, and growth in net income and revenue.
For the first quarter of fiscal 2009, Tyler reported revenue growth of 17.2% year over year. This was higher than the industry average of 8.9%, and appears to have helped boost EPS, which improved from 8 cents to 16 cents per share. Net income increased 92.1%, rising from $3.13 million to $6.01 million. The company has a strong gross profit margin of 45.9%, which has increased from the same quarter last year. Tyler's return on equity can also be considered a modest strength, as it has improved slightly from 13.73% to 15.61%. In addition, a very low debt-to-equity ratio of 0.07 implies that the company has managed its debt levels very successfully.
Management was pleased with Tyler's strong start to fiscal 2009, but did not make any changes to its previously announced 2009 guidance because of the current economic climate. Although the company shows weak operating cash flow, we feel that the strengths detailed above outweigh any potential weakness at this time.
business management software helps companies manage complex, changing business processes by automating decision-making and the implementation of those decisions. We have
since May 2008. This rating is based on the company's growth, solvency and expanding profit margins.
For the first quarter of fiscal 2009, the company reported revenue growth of 28.6% year over year. Continuing an impressive record of EPS growth, Pegasystems' EPS improved significantly, rising from 8 cents to 23 cents per share. Net income also increased in the first quarter, surging 193.5% from $2.94 million to $8.64 million. Both revenue and net income growth exceeded the averages for the company's industry. Pegasystems' gross profit margin is rather high at 67.1%; it has increased from the same quarter a year ago. The company has no debt to speak of, and its resulting debt-to-equity of zero can be seen as a favorable sign. In addition, Pegasystems maintains a quick ratio of 3.2, which clearly demonstrates its ability to cover short-term cash needs.
Management reported that the first quarter marked Peagsystem's seventh consecutive quarter of record-setting revenue and indicated that the company is off to a strong start in fiscal 2009. Although the stock is currently trading at a premium valuation, we feel that the strengths detailed above justify the higher price levels at this time.
is a provider of IT services and solutions to U.S. federal government agencies. The company focuses on designing, implementing, maintaining, and upgrading IT systems and networks. NCI has been
since February 2008 based on its healthy growth in revenue and net income, solid stock price performance, impressive record of EPS growth and largely solid financial position.
For the first quarter of fiscal 2009, NCI reported revenue growth of 14.8% year over year, which was higher than the industry average of 1.4%. This growth appears to have trickled down to the company's bottom line, as EPS improved 25.9% compared to the same quarter a year ago. We feel that NCI's two-year trend of positive EPS growth should continue. The company also reported increased net income, which rose 28.8% from $3.63 million to $4.68 million. An additional strength is the company's debt-to-equity ratio of 0.29, which is below the industry average and indicates successful management of debt levels. To add to this, NCI has a quick ratio of 1.55, demonstrating an ability to cover short-term liquidity needs.
Management was pleased with what it considered solid results for the first quarter. Looking ahead, the company announced expectations of diluted EPS in the range of 34 cents to 36 cents for the second quarter and $1.44 to $1.52 for full-year fiscal 2009. The stock has risen 35.77% over the past year, and we feel that the stock should continue to move higher on the strength of the positive factors detailed above, despite its low profit margins. Bear in mind, however, that almost any stock can fall in a broad market decline.
( MVL) is a character-based entertainment company. The company and its subsidiaries engage in the licensing, publishing, and film production businesses related to Marvel's library of approximately 5,000 characters, including Spider-Man, the X-Men, and The Fantastic Four. We
since May 2007 on the basis of its largely solid financial position, expanding profit margins, revenue growth and good cash flow from operations.
For the first quarter of fiscal 2009, Marvel reported very impressive revenue growth of 75% year over year. This growth greatly exceeded the industry average of 3.9% but does not appear to have trickled down to the company's bottom line. The company's gross profit margin is currently very high at 93.4% and has increased since the same quarter of last year. Net operating cash flow also significantly increased in the first quarter, rising 402.84% to $201.37 million. Marvel has a very low debt-to-equity ratio of 0.15, but this is currently above the industry average.
Management announced that strong results from the licensing and film production segments in the first quarter drove the overall results for the quarter. In response to stronger-than-expected operating performance in the first quarter and a decline in its anticipated full-year tax rate, Marvel raised the low end of its full year fiscal 2009 guidance. The company now anticipates full-year net income in the range of $86 million to $105 million and diluted earnings per share in the range of $1.10 to $1.35 per share. The stock's performance has been lackluster of late, but we feel that the strengths detailed above should outweigh any weakness.
TheStreet.com Ratings, recently cited for Best Stock Selection from October 2007 through February 2009 , is an independent research provider that combines fundamental and technical analysis to offer investors tremendous value in volatile times. To see how your portfolio can use this research, click here now!Our quantitative rating, which can be viewed for any stock through our stock screener stock rating screener, is based on a variety of historical fundamental and pricing data and represents our opinion of a stock's risk-adjusted performance relative to other stocks. However, the rating does not incorporate all of the factors that can alter a stock's performance. For example, it doesn't always factor in recent corporate or industry events that could affect the stock price, nor does it include recent technology developments and competitive dynamics that may affect the company.For those reasons, we believe that a rating alone cannot tell the whole story and that it should be part of an investor's overall research.