NEW YORK ( TheStreet) -- MAP Pharmaceuticals (Nasdaq: MAPP) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value. Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Pharmaceuticals industry. The net income increased by 179.0% when compared to the same quarter one year prior, rising from -$14.18 million to $11.21 million.
- MAPP's debt-to-equity ratio is very low at 0.02 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 5.08, which clearly demonstrates the ability to cover short-term cash needs.
- 48.90% is the gross profit margin for MAP PHARMACEUTICALS INC which we consider to be strong. It has increased significantly from the same period last year. Along with this, the net profit margin of 47.00% significantly outperformed against the industry average.
- Net operating cash flow has significantly increased by 197.27% to $10.90 million when compared to the same quarter last year. In addition, MAP PHARMACEUTICALS INC has also vastly surpassed the industry average cash flow growth rate of -3.43%.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
-- Written by a member of TheStreet RatingsStaff