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 largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, good cash flow from operations, solid stock price performance 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:
- Although RTEC's debt-to-equity ratio of 0.21 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 8.60, which clearly demonstrates the ability to cover short-term cash needs.
- Net operating cash flow has significantly increased by 112.09% to $12.82 million when compared to the same quarter last year. In addition, RUDOLPH TECHNOLOGIES INC has also vastly surpassed the industry average cash flow growth rate of 47.49%.
- Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- The revenue fell significantly faster than the industry average of 18.4%. Since the same quarter one year prior, revenues fell by 20.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
Rudolph Technologies, Inc. designs, develops, manufactures, and sells process control defect inspection, metrology, and process control software systems to microelectronics device manufacturers. The company has a P/E ratio of 10.4, equal to the average electronics industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Rudolph has a market cap of $295 million and is part of the
industry. Shares are up 12.5% year to date as of the close of trading on Tuesday.
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