NEW YORK ( TheStreet) -- Camtek (Nasdaq: CAMT) 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 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:
  • 46.50% is the gross profit margin for CAMTEK LTD which we consider to be strong. It has increased significantly from the same period last year. Despite the strong results of the gross profit margin, CAMT's net profit margin of 5.20% significantly trails the industry average.
  • 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 132.9% when compared to the same quarter one year prior, rising from -$3.98 million to $1.31 million.
  • CAMTEK LTD 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, CAMTEK LTD turned its bottom line around by earning $0.10 versus -$0.41 in the prior year. This year, the market expects an improvement in earnings ($0.41 versus $0.10).
  • CAMT's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.17, which illustrates the ability to avoid short-term cash problems.
  • The revenue growth greatly exceeded the industry average of 7.5%. Since the same quarter one year prior, revenues rose by 47.7%. Growth in the company's revenue appears to have helped boost the earnings per share.

Camtek Ltd. designs, develops, manufactures, and markets automatic optical inspection (AOI) systems and related products in the Asia Pacific, North America, and Europe. The company has a P/E ratio of 43.7, equal to the average electronics industry P/E ratio and above the S&P 500 P/E ratio of 16.7. Camtek has a market cap of $115.2 million and is part of the technology sector and electronics industry. Shares are up 31.7% year to date as of the close of trading on Monday.

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