NEW YORK ( TheStreet) -- PetMed Express (Nasdaq: PETS) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins. Highlights from the ratings report include:
- PETS's revenue growth trails the industry average of 32.8%. Since the same quarter one year prior, revenues slightly increased by 9.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- PETS 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 6.25, which clearly demonstrates the ability to cover short-term cash needs.
- Net operating cash flow has significantly increased by 587.85% to $6.67 million when compared to the same quarter last year. In addition, PETMED EXPRESS INC has also vastly surpassed the industry average cash flow growth rate of -52.85%.
- The change in net income from the same quarter one year ago has exceeded that of the S&P 500 and the Internet & Catalog Retail industry average. The net income has decreased by 3.7% when compared to the same quarter one year ago, dropping from $4.15 million to $3.99 million.
-- Written by a member of TheStreet RatingsStaff