NEW YORK (
) 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, impressive record of earnings per share growth, compelling growth in net income, attractive valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 0.7%. Since the same quarter one year prior, revenues rose by 23.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- ABM INDUSTRIES INC has improved earnings per share by 30.0% 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, ABM INDUSTRIES INC increased its bottom line by earning $1.21 versus $1.07 in the prior year. This year, the market expects an improvement in earnings ($1.37 versus $1.21).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Commercial Services & Supplies industry average. The net income increased by 33.0% when compared to the same quarter one year prior, rising from $20.96 million to $27.88 million.
- Net operating cash flow has increased to $51.66 million or 43.63% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -1.77%.
ABM Industries Incorporated, through its subsidiaries, provides facility services for commercial, industrial, institutional, and retail facilities primarily in the United States. It operates in four segments: Janitorial, Engineering, Parking, and Security. The company has a P/E ratio of 14.8, equal to the average diversified services industry P/E ratio and below the S&P 500 P/E ratio of 17.7. ABM has a market cap of $1.1 billion and is part of the
industry. Shares are down 22.2% year to date as of the close of trading on Tuesday.
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