NEW YORK ( TheStreet) -- Quantum Corporation (NYSE: QTM) has been upgraded by TheStreet Ratings from sell to hold. 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 and expanding profit margins. However, as a counter to these strengths, we find that net income has been generally deteriorating over time. Highlights from the ratings report include:
- The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Computers & Peripherals industry average, but is greater than that of the S&P 500. The net income increased by 62.1% when compared to the same quarter one year prior, rising from -$4.37 million to -$1.65 million.
- QUANTUM CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. Stable earnings per share over the past year indicate the company has sound management over its earnings and share float. However, the consensus estimates suggest that there will be an upward trend in the coming year. During the past fiscal year, QUANTUM CORP's EPS of $0.02 remained unchanged from the prior years' EPS of $0.02. This year, the market expects an improvement in earnings ($0.21 versus $0.02).
- Net operating cash flow has increased to $23.41 million or 27.90% when compared to the same quarter last year. Despite an increase in cash flow of 27.90%, QUANTUM CORP is still growing at a significantly lower rate than the industry average of 158.73%.
- Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.94 is weak.
- The revenue growth significantly trails the industry average of 72.1%. Since the same quarter one year prior, revenues slightly increased by 0.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.