NEW YORK ( TheStreet) -- Sealed Air Corporation (NYSE: SEE) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows low profit margins. Highlights from the ratings report include:
- SEE's revenue growth trails the industry average of 24.6%. Since the same quarter one year prior, revenues rose by 10.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Net operating cash flow has significantly increased by 53.22% to $156.90 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 32.21%.
- SEALED AIR CORP' earnings per share from the most recent quarter came in slightly below the year earlier quarter. 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, SEALED AIR CORP increased its bottom line by earning $1.45 versus $1.36 in the prior year. This year, the market expects an improvement in earnings ($1.73 versus $1.45).
- Despite currently having a low debt-to-equity ratio of 0.56, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.99 is weak.
- The change in net income from the same quarter one year ago has significantly exceeded that of the Containers & Packaging industry average, but is less than that of the S&P 500. The net income has decreased by 3.7% when compared to the same quarter one year ago, dropping from $76.50 million to $73.70 million.