Reis Inc. Stock Upgraded (REIS)

NEW YORK ( TheStreet) -- Reis (Nasdaq: REIS) 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, reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • REIS's revenue growth trails the industry average of 36.2%. Since the same quarter one year prior, revenues rose by 10.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • REIS's debt-to-equity ratio is very low at 0.06 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Despite the fact that REIS's debt-to-equity ratio is low, the quick ratio, which is currently 0.67, displays a potential problem in covering short-term cash needs.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • REIS INC reported flat earnings per share in the most recent quarter. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, REIS INC increased its bottom line by earning $0.44 versus $0.04 in the prior year. For the next year, the market is expecting a contraction of 77.3% in earnings ($0.10 versus $0.44).

Reis, Inc., through its subsidiary, Reis Services, provides commercial real estate market information and analytical tools in the United States. The company has a P/E ratio of 22.9, below the average diversified services industry P/E ratio of 25.5 and above the S&P 500 P/E ratio of 17.7. Reis has a market cap of $120 million and is part of the services sector and diversified services industry. Shares are up 23.1% year to date as of the close of trading on Tuesday.

You can view the full Reis 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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