NEW YORK ( TheStreet) -- EasyLink Services International Corporation (Nasdaq: ESIC) 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, notable return on equity, attractive valuation levels, solid stock price performance and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had generally poor debt management on most measures that we evaluated. Highlights from the ratings report include:
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Internet Software & Services industry and the overall market, EASYLINK SERVICES INTL CORP's return on equity exceeds that of both the industry average and the S&P 500.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Internet Software & Services industry. The net income increased by 118.2% when compared to the same quarter one year prior, rising from $1.99 million to $4.34 million.
- EASYLINK SERVICES INTL CORP 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. During the past fiscal year, EASYLINK SERVICES INTL CORP turned its bottom line around by earning $0.53 versus -$0.46 in the prior year.
- Powered by its strong earnings growth of 116.66% and other important driving factors, this stock has surged by 64.68% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
- ESIC's very impressive revenue growth greatly exceeded the industry average of 20.8%. Since the same quarter one year prior, revenues leaped by 132.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.