NEW YORK ( TheStreet) -- Air Transport Services Group (Nasdaq: ATSG) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its increase in net income, attractive valuation levels and growth in earnings per share. We feel these strengths outweigh the fact that the company has had generally poor debt management on most measures that we evaluated. Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the Air Freight & Logistics industry average, but is less than that of the S&P 500. The net income increased by 9.2% when compared to the same quarter one year prior, going from $11.84 million to $12.93 million.
- AIR TRANSPORT SERVICES GROUP has improved earnings per share by 10.5% 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, AIR TRANSPORT SERVICES GROUP reported lower earnings of $0.36 versus $0.63 in the prior year. This year, the market expects an improvement in earnings ($0.80 versus $0.36).
- ATSG, with its decline in revenue, underperformed when compared the industry average of 10.1%. Since the same quarter one year prior, revenues slightly dropped by 6.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- The gross profit margin for AIR TRANSPORT SERVICES GROUP is currently lower than what is desirable, coming in at 28.90%. Regardless of ATSG's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, ATSG's net profit margin of 7.80% compares favorably to the industry average.
-- Written by a member of TheStreet RatingsStaff