NEW YORK ( TheStreet) -- SEI Investments Company (Nasdaq: SEIC) 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 and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself. Highlights from the ratings report include:
- SEIC 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 4.08, which clearly demonstrates the ability to cover short-term cash needs.
- Despite the weak revenue results, SEIC has significantly outperformed against the industry average of 41.7%. Since the same quarter one year prior, revenues slightly dropped by 9.5%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- SEI INVESTMENTS CO's earnings per share declined by 24.2% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, SEI INVESTMENTS CO reported lower earnings of $1.12 versus $1.22 in the prior year. This year, the market expects an improvement in earnings ($1.25 versus $1.12).
- The change in net income from the same quarter one year ago has significantly exceeded that of the Capital Markets industry average, but is less than that of the S&P 500. The net income has significantly decreased by 28.9% when compared to the same quarter one year ago, falling from $62.40 million to $44.40 million.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Capital Markets industry and the overall market, SEI INVESTMENTS CO's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
-- Written by a member of TheStreet RatingsStaff