NEW YORK ( TheStreet) -- Trueblue (NYSE: TBI) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, robust revenue growth, attractive valuation levels, good cash flow from operations and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows low profit margins. Highlights from the ratings report include:
- Despite the fact that TBI's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.17 is high and demonstrates strong liquidity.
- The revenue growth came in higher than the industry average of 5.0%. Since the same quarter one year prior, revenues rose by 18.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- TRUEBLUE INC has improved earnings per share by 43.5% 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, TRUEBLUE INC increased its bottom line by earning $0.45 versus $0.21 in the prior year. This year, the market expects an improvement in earnings ($0.70 versus $0.45).
- 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 Professional Services industry average. The net income increased by 36.1% when compared to the same quarter one year prior, rising from $10.22 million to $13.91 million.