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 revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, increase in stock price during the past year and increase in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
Highlights from the ratings report include:
- Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. 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.
- 36.50% is the gross profit margin for MET-PRO CORP which we consider to be strong. Regardless of MPR'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 6.00% trails the industry average.
- MET-PRO CORP reported flat earnings per share in the most recent quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, MET-PRO CORP increased its bottom line by earning $0.43 versus $0.31 in the prior year. This year, the market expects an improvement in earnings ($0.47 versus $0.43).
- MPR's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.79, which clearly demonstrates the ability to cover short-term cash needs.
- The revenue growth significantly trails the industry average of 40.0%. Since the same quarter one year prior, revenues slightly increased by 5.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
Met-Pro Corporation manufactures and sells product recovery and pollution control equipment for purification of air and liquids, fluid handling equipment for corrosive, abrasive and high temperature liquids, and filtration and purification products in the United States and internationally. The company has a P/E ratio of 26.3, above the average industrial industry P/E ratio of 25.7 and above the S&P 500 P/E ratio of 17.7. Met-Pro has a market cap of $162.1 million and is part of the
industry. Shares are down 6.9% year to date as of the close of trading on Tuesday.
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