Each business day, TheStreet.com Ratings TheStreet.com Ratings compiles a list of the top five stocks in one of five categories -- fast-growth, all-around value, large-cap, mid-cap and small-cap -- based on data from the close of the previous trading session. Today we focus on mid-caps.
These are stocks of companies that have market capitalizations of between $500 million and $10 billion that rank near the top of all stocks rated by our proprietary quantitative model, which looks at more than 60 factors.
The stocks must also be followed by at least one financial analyst who posts estimates on the Institutional Brokers' Estimate System. They are ordered by their potential to appreciate.
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.
is an international higher education company that operates DeVry University, Ross University, Chamberlin College of Nursing, and Becker Professional Review. The company has been
since January 2007. DeVry's strengths can be seen in a variety of areas, such as its impressive record of earnings-per-share growth, robust revenue growth, return on equity, and largely solid financial position. Soild stock price performance also contributes to the buy rating.
The company announced on Jan. 27 that its revenues rose 35% year over year in the second quarter of fiscal 2009, helped by increased revenue across segments and the acquisition of U.S. Education, which is the parent company of Apollo College and Western Career College. Revenue growth appears to have trickled down to the bottom line, as DeVry reported EPS improvement of 20.4%. Higher enrollment numbers also helped boost earnings. Net income also increased, rising to $42.9 million from $35.8 million in the second quarter of fiscal 2008. Return on equity, which improved slightly when compared to the same quarter a year ago, can be seen as a modest strength for the organization. In addition, a debt-to-equity ratio of 0.2 indicates that DeVry has successfully managed its debt levels.
Management was pleased not only with DeVry's financial results in the second quarter, but also with the employment rate of its graduates. Management stated that it was remarkable in the current job market to see 92% of recent graduates employed within six months of graduation. The company continues with a conservative capital structure that it feels is appropriate to the current economic climate, although it does continue to invest in growth opportunities. Looking ahead, DeVry expects its full year 2009 capital expenditure to be in the range of $65.00 million to $70 million. Although the company shows low profit margins, we feel that the strengths detailed above outweigh any weaknesses at this time.
provides technologies and solutions for mission-critical national security programs for the intelligence community, the space community, and various departments and agencies of the U.S. federal government. ManTech has been
since March 2005. Our rating is based on strengths such as the company's robust revenue growth, largely solid financial position, and record of EPS growth.
For the third quarter of fiscal 2008, revenue rose by 26.8% year over year. This increase was primarily the result of a business strategy focused on high-end defense and intelligence markets supporting U.S. national security. Revenue growth appears to have helped boost earnings per share, which improved 31.4% when compared to the same quarter a year ago. The EPS increase from 51 cents to 67 cents represents the continuation of a pattern of positive EPS growth demonstrated by ManTech over the past two years, a trend which we feel should continue. Net income also increased in the third quarter, rising from $17.48 million in the third quarter of fiscal 2007 to $23.86 million in the most recent quarter. ManTech's very low debt-to-equity ratio of 0.007 and quick ratio of 1.42 illustrate the company's successful management of debt levels and ability to avoid short-term cash problems.
Management announced it was pleased with the third quarter results, as strong performance and excellent cash flow helped provide necessary flexibility in a challenging economic environment. Based on strong business momentum in its national security and defense business, the company set EPS guidance at 67 cents to 70 cents for the fourth quarter and $2.53 to $2.56 for full-year fiscal 2008. These ranges represent 10% to 15% growth over the fourth quarter of fiscal 2007 and 30% to 31% growth over full-year fiscal 2007. The company currently shows low profit margins, but we feel that the strengths detailed above outweigh any potential weakness.
Gentiva Health Services
and its subsidiaries provide home health and related services throughout the United States. Our
for Gentiva has not changed since November 2005. This rating is supported by the company's solid stock price performance, compelling growth in net income, and largely solid financial position. Other strengths include its notable return on equity and expanding profit margins.
For the fourth quarter of fiscal 2008, the company reported that its net income increased 44.8% year-over-year, rising from $8.9 million to $12.8 million. EPS improved from 31 cents in the fourth quarter of fiscal 2007 to 43 cents, and this strong earnings growth was one key factor in the rise in Gentiva's stock price over the past year. Gentiva's current return on equity greatly increased when compared to the same quarter a year ago, and this can be seen as a signal of significant strength. A low debt-to-equity ratio of 0.5 implies that the company has successfully managed its debt levels, while a quick ratio of 1.7 demonstrates Gentiva's ability to cover its short-term liquidity needs.
Looking ahead, the company raised its outlook for fiscal 2009 based on the fourth quarter results. Gentiva now expects full-year net revenues in the range of $1.14 billion to $1.18 billion, as compared to the preview of $1.12 billion to $1.17 billion. Full-year diluted EPS results are expected to be between $1.72 and $1.80 per share. Although Gentiva shows weak operating cash flow, we feel that the strengths detailed above outweigh any potential weakness at this time.
is a global leader in blood processing technology, designing, manufacturing, and marketing automated blood processing systems and single use consumables for blood donors and surgical patients. Our
for Haemonetics has been in place since February 2004, based on such strengths as the company's robust revenue growth, largely solid financial position, improvement in net income and EPS, and solid stock price performance.
For the third quarter of fiscal 2009, the company reported on February 2 that its revenue rose 15.5% year over year, with double-digit growth recorded across all geographies. This improvement slightly outpaced the industry average of 13.6%. It also appears to have trickled down to the company's bottom line, as EPS increased 14.8% when compared to the same quarter a year ago. Net income grew 13.1%, rising from $14.34 million to $16.2 million. Haemonetics has a very low debt-to-equity ratio of 0.02, implying that it has successfully managed its debt levels. In addition, a quick ratio of 2.9 indicates that the company has the ability to cover its short-term cash needs.
Due to stronger-than-planned sales of plasma disposables, blood bank disposables, and equipment and the strong third quarter revenue results from all geographies, Haemonetics raised its full year revenue guidance. The company now anticipates revenue growth of 15% to 16%, up from previously announced expectations for 12% to 14% full year revenue growth. The company shows somewhat disappointing return on equity, but we feel that the strengths detailed above outweigh any potential weakness at this time.
New Jersey Resources
is an energy services holding company that provides retail and wholesale energy services to customers in New Jersey, other states from the Gulf Coast to New England, and Canada. Our
for New Jersey Resources Corporation has been in place since September 2002. This rating is supported by the company's solid stock price performance and notable return on equity.
For the first quarter of fiscal 2009, the company experienced declines in revenue and earnings, including a steep decline in EPS when compared to the same quarter a year ago. We feel that its EPS is likely to continue to fall in the coming year, but we are encouraged by other strengths despite this. Return on equity, for example, improved slightly when compared to the first quarter of fiscal 2008. This can be viewed as a modest strength for the organization. In addition, the stock's price has not only risen over the past year, but it has outperformed the
despite the company's weak earnings results.
Looking forward, the company raised its net financial earnings guidance for the year to a range of $2.32 to $2.42 per basic share from a range of $2.30 to $2.40 per basic share. This increase is due to stronger-than-expected utility results.
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 a rating alone cannot tell the whole story and should be part of an investor's overall research.