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 compelling growth in net income, largely solid financial position with reasonable debt levels by most measures, notable return on equity, good cash flow from operations and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Metals & Mining industry. The net income increased by 1630.9% when compared to the same quarter one year prior, rising from -$2.31 million to $35.29 million.
- NSU's debt-to-equity ratio is very low at 0.06 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 2.67, which clearly demonstrates the ability to cover short-term cash needs.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Metals & Mining industry and the overall market, NEVSUN RESOURCES LTD's return on equity exceeds that of both the industry average and the S&P 500.
- Net operating cash flow has significantly increased by 8788.20% to $111.21 million when compared to the same quarter last year. In addition, NEVSUN RESOURCES LTD has also vastly surpassed the industry average cash flow growth rate of 53.73%.
- The gross profit margin for NEVSUN RESOURCES LTD is currently very high, coming in at 79.90%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 26.20% trails the industry average.
Nevsun Resources Ltd., a natural resource company, together with its subsidiaries, engages in the acquisition, exploration, development, and production of mineral properties. It principally mines and explores for gold, as well as base metals, such as copper and zinc. The company has a P/E ratio of 32.6, equal to the average metals & mining industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Nevsun has a market cap of $1.4 billion and is part of the
industry. Shares are down 10.5% year to date as of the close of trading on Tuesday.
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