NEW YORK ( TheStreet) -- ClickSoftware Technologies (Nasdaq: CKSW) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, reasonable valuation levels and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income. Highlights from the ratings report include:
- CLICKSOFTWARE TECHNOLOGIES's earnings per share declined by 22.2% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, CLICKSOFTWARE TECHNOLOGIES reported lower earnings of $0.28 versus $0.41 in the prior year. This year, the market expects an improvement in earnings ($0.47 versus $0.28).
- Compared to its closing price of one year ago, CKSW's share price has jumped by 42.60%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, CKSW should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- CKSW 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 3.23, which clearly demonstrates the ability to cover short-term cash needs.
- The revenue growth came in higher than the industry average of 2.1%. Since the same quarter one year prior, revenues rose by 10.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.