NEW YORK ( TheStreet) -- Argo Group International Holdings (Nasdaq: AGII) 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, revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself. Highlights from the ratings report include:
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Insurance industry average. The net income increased by 120.8% when compared to the same quarter one year prior, rising from -$94.10 million to $19.60 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 13.1%. Since the same quarter one year prior, revenues slightly increased by 8.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
- AGII's debt-to-equity ratio is very low at 0.25 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- ARGO GROUP INTL HOLDINGS LTD 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, ARGO GROUP INTL HOLDINGS LTD swung to a loss, reporting -$2.99 versus $2.74 in the prior year. This year, the market expects an improvement in earnings ($2.45 versus -$2.99).
-- Written by a member of TheStreet RatingsStaff