NEW YORK ( TheStreet) -- Synovis Life Technologies (Nasdaq: SYNO) 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, growth in earnings per share, increase in net income and good cash flow from operations. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • SYNO's revenue growth has slightly outpaced the industry average of 9.8%. Since the same quarter one year prior, revenues rose by 19.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • SYNO 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 9.71, which clearly demonstrates the ability to cover short-term cash needs.
  • SYNOVIS LIFE TECH INC has improved earnings per share by 30.8% 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, SYNOVIS LIFE TECH INC increased its bottom line by earning $0.43 versus $0.23 in the prior year. This year, the market expects an improvement in earnings ($0.66 versus $0.43).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Health Care Equipment & Supplies industry average. The net income increased by 31.8% when compared to the same quarter one year prior, rising from $1.51 million to $1.99 million.
  • Net operating cash flow has significantly increased by 115.67% to $4.73 million when compared to the same quarter last year. In addition, SYNOVIS LIFE TECH INC has also vastly surpassed the industry average cash flow growth rate of 0.96%.

Synovis Life Technologies, Inc., a medical device company, develops, manufactures, and markets mechanical and biological products used by surgical specialties for the repair of soft tissue damaged or destroyed by disease or injury. The company has a P/E ratio of 27.9, equal to the average health services industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Synovis Life has a market cap of $202.6 million and is part of the health care sector and health services industry. Shares are up 8.9% year to date as of the close of trading on Friday.

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