NEW YORK ( TheStreet) -- Charles River Laboratories International In (NYSE: CRL) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its notable return on equity, increase in stock price during the past year and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally poor debt management on most measures that we evaluated.
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- 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 Life Sciences Tools & Services industry and the overall market, CHARLES RIVER LABS INTL INC's return on equity exceeds that of both the industry average and the S&P 500.
- CHARLES RIVER LABS INTL INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. 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, CHARLES RIVER LABS INTL INC turned its bottom line around by earning $2.23 versus -$5.81 in the prior year. This year, the market expects an improvement in earnings ($2.68 versus $2.23).
- Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- 41.90% is the gross profit margin for CHARLES RIVER LABS INTL INC which we consider to be strong. Regardless of CRL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, CRL's net profit margin of 10.70% compares favorably to the industry average.
- CRL, with its decline in revenue, slightly underperformed the industry average of 5.1%. Since the same quarter one year prior, revenues slightly dropped by 1.2%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
-- Written by a member of TheStreet Ratings Staff