Myriad Genetics Inc. Stock Upgraded (MYGN)

NEW YORK ( TheStreet) -- Myriad Genetics (Nasdaq: MYGN) 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, solid stock price performance, reasonable valuation levels and growth in earnings per share. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 2.4%. Since the same quarter one year prior, revenues rose by 22.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • MYGN 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 11.26, which clearly demonstrates the ability to cover short-term cash needs.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. 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.
  • MYRIAD GENETICS INC has improved earnings per share by 26.9% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, MYRIAD GENETICS INC reported lower earnings of $1.11 versus $1.54 in the prior year. This year, the market expects an improvement in earnings ($1.25 versus $1.11).

Myriad Genetics, Inc., a molecular diagnostic company, focuses on the development and marketing of novel predictive medicine, personalized medicine, and prognostic medicine tests primarily in the United States. The company has a P/E ratio of 19.4, equal to the average diversified services industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Myriad has a market cap of $1.9 billion and is part of the services sector and diversified services industry. Shares are up 14.5% year to date as of the close of trading on Thursday.

You can view the full Myriad Ratings Report or get investment ideas from our investment research center.

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