Prestige Brands Holdings Inc Stock Upgraded (PBH)

NEW YORK ( TheStreet) -- Prestige Brands Holdings (NYSE: PBH) 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, solid stock price performance, attractive valuation levels, compelling growth in net income and impressive record of earnings per share growth. 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 3.3%. Since the same quarter one year prior, revenues rose by 17.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 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.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Personal Products industry. The net income increased by 336.6% when compared to the same quarter one year prior, rising from $2.18 million to $9.51 million.
  • PRESTIGE BRANDS HOLDINGS reported significant earnings per share improvement 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, PRESTIGE BRANDS HOLDINGS reported lower earnings of $0.59 versus $0.64 in the prior year. This year, the market expects an improvement in earnings ($0.96 versus $0.59).
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Prestige Brands Holdings, Inc., together with its subsidiaries, engages in marketing, selling, and distributing over-the-counter healthcare and household cleaning products primarily in North America. The company has a P/E ratio of 18.7, above the average drugs industry P/E ratio of 17 and above the S&P 500 P/E ratio of 17.7. Prestige has a market cap of $617.3 million and is part of the health care sector and drugs industry. Shares are up 19.4% year to date as of the close of trading on Friday.

You can view the full Prestige Ratings Report or get investment ideas from our investment research center.
-- Written by a member of TheStreet RatingsStaff

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