NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and increase in net income. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
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Highlights from the ratings report include:
- DIRECTV has improved earnings per share by 25.9% 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, DIRECTV increased its bottom line by earning $3.48 versus $2.48 in the prior year. This year, the market expects an improvement in earnings ($4.34 versus $3.48).
- Despite its growing revenue, the company underperformed as compared with the industry average of 13.5%. Since the same quarter one year prior, revenues rose by 11.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.08 is sturdy.
- Net operating cash flow has increased to $1,763.00 million or 34.68% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 16.88%.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Media industry average. The net income increased by 8.4% when compared to the same quarter one year prior, going from $674.00 million to $731.00 million.
DIRECTV provides digital television entertainment primarily in the United States and Latin America. The company engages in acquiring, promoting, selling, and distributing digital entertainment programming primarily via satellite to residential and commercial subscribers. The company has a P/E ratio of 12.4, equal to the average media industry P/E ratioand below the S&P 500 P/E ratio of 17.7. DIRECTV has a market cap of $29.97 billion and is part of the
industry. Shares are up 7% year to date as of the close of trading on Wednesday.
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--Written by a member of TheStreet Ratings Staff.
TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.