Spectrum Pharmaceuticals Inc Stock Upgraded (SPPI)

NEW YORK ( TheStreet) -- Spectrum Pharmaceuticals (Nasdaq: SPPI) 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, attractive valuation levels and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 3.7%. Since the same quarter one year prior, revenues rose by 37.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • SPPI 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 2.92, which clearly demonstrates the ability to cover short-term cash needs.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Biotechnology industry and the overall market, SPECTRUM PHARMACEUTICALS INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for SPECTRUM PHARMACEUTICALS INC is currently very high, coming in at 86.70%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 77.80% significantly outperformed against the industry average.

Spectrum Pharmaceuticals, Inc., a biotechnology company, engages in acquiring, developing, and commercializing prescription drug products primarily in the areas of hematology and oncology. The company has a P/E ratio of 11.6, below the average drugs industry P/E ratio of 11.7 and below the S&P 500 P/E ratio of 17.7. Spectrum has a market cap of $911.3 million and is part of the health care sector and drugs industry. Shares are up 6.4% year to date as of the close of trading on Monday.

You can view the full Spectrum Ratings Report or get investment ideas from our investment research center.

-- Written by a member of TheStreet Ratings Staff

TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
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