NEW YORK ( TheStreet) -- Universal Truckload Services (Nasdaq: UACL) 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, impressive record of earnings per share growth, compelling growth in net income and reasonable 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 exceeded that of the S&P 500 and the Road & Rail industry average. The net income increased by 40.4% when compared to the same quarter one year prior, rising from $2.07 million to $2.90 million.
- UNIVERSAL TRUCKLOAD SERVICES has improved earnings per share by 46.1% 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 year. We feel that this trend should continue. During the past fiscal year, UNIVERSAL TRUCKLOAD SERVICES increased its bottom line by earning $0.80 versus $0.31 in the prior year. This year, the market expects an improvement in earnings ($0.93 versus $0.80).
- UACL 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. To add to this, UACL has a quick ratio of 1.87, which demonstrates the ability of the company to cover short-term liquidity needs.
- UACL's revenue growth has slightly outpaced the industry average of 12.4%. Since the same quarter one year prior, revenues rose by 13.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.