NEW YORK ( TheStreet) -- Koss Corporation (Nasdaq: KOSS) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income, revenue growth, notable return on equity and expanding profit margins. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:
  • 42.00% is the gross profit margin for KOSS CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 10.80% is above that of the industry average.
  • 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 Household Durables industry and the overall market, KOSS CORP's return on equity exceeds that of both the industry average and the S&P 500.
  • KOSS's revenue growth trails the industry average of 31.3%. Since the same quarter one year prior, revenues slightly increased by 4.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Household Durables industry. The net income increased by 174.8% when compared to the same quarter one year prior, rising from -$1.85 million to $1.38 million.
  • 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. Although other factors naturally played a role, the company's strong earnings growth was key. 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.

Koss Corporation designs, manufactures, and sells stereo headphones and related accessory products. The company has a P/E ratio of 29.5, above the S&P 500 P/E ratio of 17.5. Koss has a market cap of $54.5 million and is part of the consumer goods sector and consumer durables industry. Shares are up 45.4% year to date as of the close of trading on Thursday.

You can view the full Koss Ratings Report or get investment ideas from our investment research center.
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