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Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link

.

NEW YORK (

TheStreet

)

-- Advent Software

(Nasdaq:

ADVS

) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, expanding profit margins, good cash flow from operations and increase in stock price during the past year. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

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Highlights from the ratings report include:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Software industry. The net income increased by 412.4% when compared to the same quarter one year prior, rising from -$4.05 million to $12.64 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 10.8%. Since the same quarter one year prior, revenues slightly increased by 4.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The gross profit margin for ADVENT SOFTWARE INC is currently very high, coming in at 74.77%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 12.59% trails the industry average.
  • Net operating cash flow has slightly increased to $22.38 million or 2.55% when compared to the same quarter last year. Despite an increase in cash flow, ADVENT SOFTWARE INC's cash flow growth rate is still lower than the industry average growth rate of 39.54%.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.

Advent Software, Inc. provides software products and services for automating and integrating data and work flows across the investment management organization, as well as between the investment management organization and external parties worldwide. Advent Software has a market cap of $1.61 billion and is part of the technology sector and computer software & services industry. Shares are down 4.6% year to date as of the close of trading on Wednesday.

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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.