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"We rate LEADING BRANDS INC (LBIX) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. Among the primary strengths of the company is its expanding profit margins over time. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- LEADING BRANDS INC reported flat earnings per share in the most recent quarter. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, LEADING BRANDS INC increased its bottom line by earning $0.36 versus $0.15 in the prior year.
- 45.23% is the gross profit margin for LEADING BRANDS INC which we consider to be strong. Regardless of LBIX's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 10.21% trails the industry average.
- LBIX, with its decline in revenue, slightly underperformed the industry average of 4.1%. Since the same quarter one year prior, revenues slightly dropped by 0.2%. Weakness in the company's revenue seems to not be hurting the bottom line, shown by stable earnings per share.
- The change in net income from the same quarter one year ago has significantly exceeded that of the Beverages industry average, but is less than that of the S&P 500. The net income has decreased by 4.6% when compared to the same quarter one year ago, dropping from $0.43 million to $0.41 million.
- LBIX has underperformed the S&P 500 Index, declining 20.00% from its price level of one year ago. Despite the decline in its share price over the last year, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry. We feel, however, that other strengths this company displays compensate for this.
- You can view the full analysis from the report here: LBIX Ratings Report