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 (
) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income, good cash flow from operations, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
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Highlights from the ratings report include:
- SATS's revenue growth has slightly outpaced the industry average of 2.8%. Since the same quarter one year prior, revenues slightly increased by 6.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Communications Equipment industry. The net income increased by 415.6% when compared to the same quarter one year prior, rising from -$9.76 million to $30.80 million.
- Net operating cash flow has increased to $170.50 million or 19.15% when compared to the same quarter last year. In addition, ECHOSTAR CORP has also modestly surpassed the industry average cash flow growth rate of 14.26%.
- 38.44% is the gross profit margin for ECHOSTAR CORP which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, SATS's net profit margin of 3.50% significantly trails the industry average.
- SATS's debt-to-equity ratio of 0.69 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 4.17 is very high and demonstrates very strong liquidity.
EchoStar Corporation provides satellite operations, video delivery solutions, and broadband satellite technologies and services for home and office worldwide. The company operates in three segments: EchoStar Technologies, Hughes, and EchoStar Satellite Services. EchoStar has a market cap of $2.16 billion and is part of the technology sector and telecommunications industry. Shares are down 0.6% year to date as of the close of trading on Wednesday.
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