Year over year quarterly shipments were up 12.8% led by net sales that increased to $91.4 million from $82.9 million in second quarter 2013.
The steel wire manufacturer posted net earnings of $3.5 million, or 19 cents per share, down from the $3.7 million, or 20 cents per share, it reported last year.
TheStreet Ratings team rates INSTEEL INDUSTRIES as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate INSTEEL INDUSTRIES (IIIN) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- INSTEEL INDUSTRIES has improved earnings per share by 15.4% 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, INSTEEL INDUSTRIES increased its bottom line by earning $0.64 versus $0.10 in the prior year. This year, the market expects an improvement in earnings ($1.08 versus $0.64).
- Despite its growing revenue, the company underperformed as compared with the industry average of 3.4%. Since the same quarter one year prior, revenues slightly increased by 1.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- IIIN has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.27, which illustrates the ability to avoid short-term cash problems.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 27.03% over the past year, a rise that has exceeded that of the S&P 500 Index. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- You can view the full analysis from the report here: IIIN Ratings Report