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 robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and attractive valuation levels. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
Highlights from the ratings report include:
- YONG's very impressive revenue growth greatly exceeded the industry average of 14.3%. Since the same quarter one year prior, revenues leaped by 73.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- YONG'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 2.61, which clearly demonstrates the ability to cover short-term cash needs.
- YONGYE INTERNATIONAL INC has improved earnings per share by 42.6% 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, YONGYE INTERNATIONAL INC increased its bottom line by earning $1.06 versus $0.10 in the prior year. This year, the market expects an improvement in earnings ($1.11 versus $1.06).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Chemicals industry. The net income increased by 63.1% when compared to the same quarter one year prior, rising from $24.25 million to $39.54 million.
Yongye International, Inc., together with its subsidiaries, engages in the research, development, manufacture, and sale of fulvic acid based liquid and powder nutrient compounds for plants and animals, which are used in the agriculture industry in the People's Republic of China. The company has a P/E ratio of 3.3, below the average chemicals industry P/E ratio of four and below the S&P 500 P/E ratio of 17.7. Yongye International has a market cap of $263.1 million and is part of the
industry. Shares are down 35.7% year to date as of the close of trading on Tuesday.
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