NEW YORK ( TheStreet) -- Triple-S Management Corporation (NYSE: GTS) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 3.2%. Since the same quarter one year prior, revenues slightly increased by 2.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The current debt-to-equity ratio, 0.31, is low and is below the industry average, implying that there has been successful management of debt levels.
  • The net income growth from the same quarter one year ago has exceeded that of the Health Care Providers & Services industry average, but is less than that of the S&P 500. The net income increased by 13.5% when compared to the same quarter one year prior, going from $15.06 million to $17.09 million.

Triple-S Management Corporation, through its subsidiaries, operates as a managed care company in Puerto Rico. It provides health benefits services to subscribers through contracts with hospitals, physicians, dentists, laboratories, and other organizations. The company has a P/E ratio of 7.8, equal to the average insurance industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Triple-S Management has a market cap of $530.9 million and is part of the financial sector and insurance industry. Shares are up 0.4% year to date as of the close of trading on Tuesday.

You can view the full Triple-S Management Ratings Report or get investment ideas from our investment research center.
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