NEW YORK ( TheStreet) -- Nuance Communications (Nasdaq: NUAN) 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, impressive record of earnings per share growth, compelling growth in net income, good cash flow from operations and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results. Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 0.6%. Since the same quarter one year prior, revenues rose by 20.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- NUANCE COMMUNICATIONS INC 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. We anticipate these figures will begin to experience more growth in the coming year. During the past fiscal year, NUANCE COMMUNICATIONS INC continued to lose money by earning -$0.07 versus -$0.08 in the prior year. This year, the market expects an improvement in earnings ($1.35 versus -$0.07).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Software industry. The net income increased by 2820.3% when compared to the same quarter one year prior, rising from -$1.53 million to $41.62 million.
- Net operating cash flow has significantly increased by 56.05% to $100.06 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 7.73%.
- The gross profit margin for NUANCE COMMUNICATIONS INC is rather high; currently it is at 69.30%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, NUAN's net profit margin of 12.70% significantly trails the industry average.