NEW YORK (
-- Electronics for Imaging
) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, robust revenue growth, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
Highlights from the ratings report include:
- Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- EFII 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. Along with this, the company maintains a quick ratio of 2.59, which clearly demonstrates the ability to cover short-term cash needs.
- The revenue growth significantly trails the industry average of 72.7%. Since the same quarter one year prior, revenues rose by 26.4%. 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 Computers & Peripherals industry. The net income increased by 154.9% when compared to the same quarter one year prior, rising from -$11.38 million to $6.25 million.
- ELECTRONICS FOR IMAGING INC reported significant earnings per share improvement 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 year. We feel that this trend should continue. During the past fiscal year, ELECTRONICS FOR IMAGING INC turned its bottom line around by earning $0.15 versus -$0.07 in the prior year. This year, the market expects an improvement in earnings ($0.95 versus $0.15).
Electronics For Imaging, Inc. provides color digital print controllers, format printers and inks, and print management solutions worldwide. The company's controller technologies transform digital copiers and printers into networked printing devices. The company has a P/E ratio of 109.8, equal to the average computer hardware industry P/E ratio and above the S&P 500 P/E ratio of 16.7. Electronics for Imaging has a market cap of $823.9 million and is part of the
industry. Shares are up 17.2% year to date as of the close of trading on Monday.
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