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, impressive record of earnings per share growth, compelling growth in net income, solid stock price performance and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally poor debt management on most measures that we evaluated.
Highlights from the ratings report include:
- SMBL's revenue growth has slightly outpaced the industry average of 24.7%. Since the same quarter one year prior, revenues rose by 33.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- SMART BALANCE 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, SMART BALANCE INC turned its bottom line around by earning $0.17 versus -$2.04 in the prior year. This year, the market expects an improvement in earnings ($0.27 versus $0.17).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Food Products industry. The net income increased by 385.3% when compared to the same quarter one year prior, rising from $0.34 million to $1.65 million.
- Powered by its strong earnings growth of 200.00% and other important driving factors, this stock has surged by 38.01% over the past year, outperforming the rise in the S&P 500 Index during the same period. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- 46.30% is the gross profit margin for SMART BALANCE INC which we consider to be strong. Regardless of SMBL'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 2.00% trails the industry average.
Smart Balance, Inc., a consumer food products company, distributes various food products in the United States and internationally. The company has a P/E ratio of 23.5, below the average food & beverage industry P/E ratio of 64.3 and above the S&P 500 P/E ratio of 17.7. Smart Balance has a market cap of $303 million and is part of the
industry. Shares are up 11.8% year to date as of the close of trading on Wednesday.
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-- Written by a member of TheStreet RatingsStaff