Editor's Note: 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.
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 revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and good cash flow from operations. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
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Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 6.5%. Since the same quarter one year prior, revenues slightly increased by 8.6%. 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 1.02 is sturdy.
- MEAD JOHNSON NUTRITION CO has improved earnings per share by 26.6% 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, MEAD JOHNSON NUTRITION CO increased its bottom line by earning $2.47 versus $2.20 in the prior year. This year, the market expects an improvement in earnings ($3.10 versus $2.47).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Food Products industry. The net income increased by 25.5% when compared to the same quarter one year prior, rising from $132.10 million to $165.80 million.
- Net operating cash flow has significantly increased by 167.60% to $247.80 million when compared to the same quarter last year. In addition, MEAD JOHNSON NUTRITION CO has also vastly surpassed the industry average cash flow growth rate of 24.88%.
Mead Johnson Nutrition Company manufactures, distributes, and sells infant formulas, children's nutrition, and other nutritional products. The company has a P/E ratio of 26.7, below the average food & beverage industry P/E ratio of 26.8 and above the S&P 500 P/E ratio of 17.7. Mead Johnson Nutrition has a market cap of $14.84 billion and is part of the
industry. Shares are up 6.1% year to date as of the close of trading on Monday.
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--Written by a member of TheStreet Ratings Staff.