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 increase in stock price during the past year, impressive record of earnings per share growth, compelling growth in net income, revenue growth and reasonable valuation levels. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
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Highlights from the ratings report include:
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- MEDASSETS 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 two years. We feel that this trend should continue. During the past fiscal year, MEDASSETS INC turned its bottom line around by earning $0.45 versus -$0.12 in the prior year. This year, the market expects an improvement in earnings ($1.40 versus $0.45).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Health Care Technology industry. The net income increased by 154.0% when compared to the same quarter one year prior, rising from -$14.35 million to $7.75 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 6.7%. Since the same quarter one year prior, revenues slightly increased by 4.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
MedAssets, Inc., a financial and performance improvement company, provides technology-enabled products and services for hospitals, health systems, and other ancillary healthcare providers in the United States. MedAssets has a market cap of $1.37 billion and is part of the technology sector and computer software & services industry. Shares are up 11.3% year to date as of the close of trading on Friday.
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