NEW YORK ( TheStreet) -- Precision Drilling (NYSE: PDS) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, robust revenue growth, solid stock price performance, good cash flow from operations and expanding profit margins. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:
  • 35.60% is the gross profit margin for PRECISION DRILLING CORP which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 4.80% trails the industry average.
  • Net operating cash flow has increased to $176.31 million or 24.15% when compared to the same quarter last year. In addition, PRECISION DRILLING CORP has also vastly surpassed the industry average cash flow growth rate of -81.06%.
  • Powered by its strong earnings growth of 125.00% and other important driving factors, this stock has surged by 142.42% 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.
  • PDS's revenue growth trails the industry average of 51.9%. Since the same quarter one year prior, revenues rose by 31.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Energy Equipment & Services industry. The net income increased by 124.6% when compared to the same quarter one year prior, rising from -$66.55 million to $16.40 million.

Precision Drilling Corporation, through its subsidiaries, provides onshore well drilling services, completion and workover services, and ancillary services to the oil and gas industry in North America and internationally. The company has a P/E ratio of 74.4, above the average energy industry P/E ratio of 67.7 and above the S&P 500 P/E ratio of 17.7. Precision has a market cap of $4.5 billion and is part of the basic materials sector and energy industry. Shares are up 81.6% year to date as of the close of trading on Monday.

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

If you liked this article you might like

5 Top Trades With Oil Prices in Full Rally Mode

5 Top Trades With Oil Prices in Full Rally Mode

The Stock Market Looks Like It Could End July With a Bang
Precision Drilling (PDS) Stock Rises on Q3 Results

Precision Drilling (PDS) Stock Rises on Q3 Results

Analysts' Actions -- Biogen, Gilead, CBS, VF Corp. and More

Analysts' Actions -- Biogen, Gilead, CBS, VF Corp. and More