NEW YORK ( TheStreet) -- Silvercorp Metals (NYSE: SVM) 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, notable return on equity and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself. Highlights from the ratings report include:
- SVM's revenue growth has slightly outpaced the industry average of 11.7%. Since the same quarter one year prior, revenues rose by 19.4%. 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.
- SVM 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 3.86, which clearly demonstrates the ability to cover short-term cash needs.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Metals & Mining industry and the overall market, SILVERCORP METALS INC's return on equity exceeds that of both the industry average and the S&P 500.
- The gross profit margin for SILVERCORP METALS INC is currently very high, coming in at 77.20%. Regardless of SVM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SVM's net profit margin of 32.40% compares favorably to the industry average.
- SILVERCORP METALS INC's earnings per share declined by 33.3% in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past two years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, SILVERCORP METALS INC increased its bottom line by earning $0.42 versus $0.24 in the prior year.
-- Written by a member of TheStreet RatingsStaff