NEW YORK ( TheStreet) -- Advanced Energy Industries (Nasdaq: AEIS) 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 has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 1962.2% when compared to the same quarter one year prior, rising from $1.52 million to $31.41 million.
  • ADVANCED ENERGY INDS 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, ADVANCED ENERGY INDS INC turned its bottom line around by earning $1.22 versus -$2.43 in the prior year. This year, the market expects an improvement in earnings ($1.57 versus $1.22).
  • AEIS 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 this, the company maintains a quick ratio of 2.60, which clearly demonstrates the ability to cover short-term cash needs.
  • AEIS's very impressive revenue growth greatly exceeded the industry average of 6.5%. Since the same quarter one year prior, revenues leaped by 155.9%. Growth in the company's revenue appears to have helped boost the earnings per share.

Advanced Energy Industries, Inc., together with its subsidiaries, designs, manufactures, sells, and supports industrial power conversion products that transform power into various usable forms. The company has a P/E ratio of 13.2, above the average electronics industry P/E ratio of 9.9 and below the S&P 500 P/E ratio of 16.4. Advanced Energy has a market cap of $706 million and is part of the technology sector and electronics industry. Shares are up 19.9% year to date as of the close of trading on Thursday.

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