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 growth in earnings per share, compelling growth in net income, robust revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company shows low profit margins.
Highlights from the ratings report include:
- AMERICAN LORAIN CORP has improved earnings per share by 25.0% in the most recent quarter compared to the same quarter a year ago. Stable earnings per share over the past two years indicate the company has sound management over its earnings and share float. We anticipate the company beginning to experience more growth in the coming year. During the past fiscal year, AMERICAN LORAIN CORP increased its bottom line by earning $0.57 versus $0.56 in the prior year. This year, the market expects an improvement in earnings ($0.60 versus $0.57).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Food Products industry. The net income increased by 39.0% when compared to the same quarter one year prior, rising from $5.09 million to $7.07 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 23.5%. Since the same quarter one year prior, revenues rose by 15.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Although ALN's debt-to-equity ratio of 0.22 is very low, it is currently higher than that of the industry average. To add to this, ALN has a quick ratio of 2.48, which demonstrates the ability of the company to cover short-term liquidity needs.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Food Products industry and the overall market, AMERICAN LORAIN CORP's return on equity exceeds that of both the industry average and the S&P 500.
American Lorain Corporation develops, manufactures, and sells various food products in China and internationally. The company has a P/E ratio of 2.5, equal to the average food & beverage industry P/E ratio and below the S&P 500 P/E ratio of 17.7. American Lorain has a market cap of $51.7 million and is part of the
industry. Shares are down 6.3% year to date as of the close of trading on Friday.
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