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, notable return on equity, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the ratings report include:
- MBT's revenue growth has slightly outpaced the industry average of 11.9%. Since the same quarter one year prior, revenues rose by 12.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Wireless Telecommunication Services industry and the overall market, MOBILE TELESYSTEMS OJSC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Net operating cash flow has increased to $1,319.22 million or 24.78% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -11.93%.
- The gross profit margin for MOBILE TELESYSTEMS OJSC is rather high; currently it is at 69.50%. Regardless of MBT's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, MBT's net profit margin of 11.00% is significantly lower than the same period one year prior.
- MOBILE TELESYSTEMS OJSC's earnings per share declined by 28.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, MOBILE TELESYSTEMS OJSC increased its bottom line by earning $1.44 versus $1.08 in the prior year. For the next year, the market is expecting a contraction of 0.3% in earnings ($1.44 versus $1.44).
Mobile TeleSystems OJSC, together with its subsidiaries, provides telecommunications services primarily in the Russian Federation, Ukraine, Uzbekistan, Turkmenistan, Armenia, and Belarus. The company has a P/E ratio of 17.7, above the average telecommunications industry P/E ratio of 13.2 and equal to the S&P 500 P/E ratio of 17.7. Mobile Telesystems OJSC has a market cap of $15.64 billion and is part of the
industry. Shares are up 22.5% year to date as of the close of trading on Friday.
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-- Written by a member of TheStreet RatingsStaff