NEW YORK ( TheStreet) -- Greenbrier Companies (NYSE: GBX) 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 solid stock price performance. We feel these strengths outweigh the fact that the company has had generally poor debt management on most measures that we evaluated. Highlights from the ratings report include:
- GBX's very impressive revenue growth greatly exceeded the industry average of 31.7%. Since the same quarter one year prior, revenues leaped by 100.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
- GREENBRIER COMPANIES INC reported significant earnings per share improvement 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, GREENBRIER COMPANIES INC increased its bottom line by earning $0.15 versus $0.09 in the prior year. This year, the market expects an improvement in earnings ($2.03 versus $0.15).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Machinery industry. The net income increased by 730.1% when compared to the same quarter one year prior, rising from -$2.30 million to $14.52 million.
- Net operating cash flow has significantly increased by 81.04% to -$8.99 million when compared to the same quarter last year. In addition, GREENBRIER COMPANIES INC has also modestly surpassed the industry average cash flow growth rate of 76.42%.
- Powered by its strong earnings growth of 536.36% and other important driving factors, this stock has surged by 28.35% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.