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 impressive record of earnings per share growth, compelling growth in net income, revenue growth, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally poor debt management on most measures that we evaluated.
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Highlights from the ratings report include:
- GAYLORD ENTERTAINMENT CO 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 two years. We feel that this trend should continue. During the past fiscal year, GAYLORD ENTERTAINMENT CO turned its bottom line around by earning $0.20 versus -$1.94 in the prior year. This year, the market expects an improvement in earnings ($0.79 versus $0.20).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 408.0% when compared to the same quarter one year prior, rising from -$1.96 million to $6.03 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 8.6%. Since the same quarter one year prior, revenues slightly increased by 8.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Net operating cash flow has significantly increased by 274.41% to $13.92 million when compared to the same quarter last year. In addition, GAYLORD ENTERTAINMENT CO has also vastly surpassed the industry average cash flow growth rate of 8.36%.
- 43.50% is the gross profit margin for GAYLORD ENTERTAINMENT CO 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, GET's net profit margin of 2.50% significantly trails the industry average.
Gaylord Entertainment Company, through its subsidiaries, operates as a hospitality and entertainment company in the United States. The company primarily focuses on the large group meetings and conventions sector of the lodging market. The company has a P/E ratio of 104.8, below the average leisure industry P/E ratio of 107.7 and above the S&P 500 P/E ratio of 17.7. Gaylord Entertainment has a market cap of $1.9 billion and is part of the
industry. Shares are up 56.3% year to date as of the close of trading on Friday.
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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.