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, good cash flow from operations, increase in net income and largely solid financial position with reasonable debt levels by most measures. 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 0.8%. Since the same quarter one year prior, revenues rose by 17.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- ADVENT SOFTWARE INC has improved earnings per share by 18.2% 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, ADVENT SOFTWARE INC increased its bottom line by earning $0.45 versus $0.40 in the prior year. This year, the market expects an improvement in earnings ($0.83 versus $0.45).
- Net operating cash flow has increased to $23.77 million or 10.54% when compared to the same quarter last year. In addition, ADVENT SOFTWARE INC has also modestly surpassed the industry average cash flow growth rate of 1.32%.
- The net income growth from the same quarter one year ago has exceeded that of the Software industry average, but is less than that of the S&P 500. The net income increased by 14.1% when compared to the same quarter one year prior, going from $5.96 million to $6.80 million.
- ADVS has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Despite the fact that ADVS's debt-to-equity ratio is low, the quick ratio, which is currently 0.55, displays a potential problem in covering short-term cash needs.
Advent Software, Inc. provides software and services that automate work flows and data across investment management organizations, as well as the information flows between an investment management organization and external parties. The company has a P/E ratio of 41.6, above the average computer software & services industry P/E ratio of 39.4 and above the S&P 500 P/E ratio of 17.7. Advent Software has a market cap of $1.2 billion and is part of the
industry. Shares are down 16.1% year to date as of the close of trading on Tuesday.
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