NEW YORK ( TheStreet) -- CNinsure (Nasdaq: CISG) 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, attractive valuation levels, impressive record of earnings per share growth and compelling growth in net income. 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 significantly exceeded that of the S&P 500 and the Insurance industry. The net income increased by 272.8% when compared to the same quarter one year prior, rising from $9.87 million to $36.78 million.
  • CNINSURE INC -ADS has improved earnings per share by 31.6% 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, CNINSURE INC -ADS increased its bottom line by earning $1.27 versus $0.95 in the prior year. This year, the market expects an improvement in earnings ($1.51 versus $1.27).
  • CISG 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 12.37, which clearly demonstrates the ability to cover short-term cash needs.
  • The revenue growth came in higher than the industry average of 8.6%. Since the same quarter one year prior, revenues rose by 33.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.

CNinsure Inc., together with its subsidiaries, provides insurance brokerage and agency services, and insurance claims adjusting services in the People's Republic of China. The company has a P/E ratio of 12.2, above the average insurance industry P/E ratio of 8.8 and below the S&P 500 P/E ratio of 17.7. CNinsure has a market cap of $792.6 million and is part of the financial sector and insurance industry. Shares are down 9.8% year to date as of the close of trading on Tuesday.

You can view the full CNinsure Ratings Report or get investment ideas from our investment research center.
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