Maxygen Inc. Stock Upgraded (MAXY)

NEW YORK ( TheStreet) -- Maxygen (Nasdaq: MAXY) 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, attractive valuation levels, expanding profit margins and good cash flow from operations. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • MAXY's very impressive revenue growth greatly exceeded the industry average of 7.4%. Since the same quarter one year prior, revenues leaped by 999900.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • MAXY 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 78.77, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for MAXYGEN INC is currently very high, coming in at 92.00%. It has increased significantly from the same period last year. Along with this, the net profit margin of 90.40% significantly outperformed against the industry average.
  • Net operating cash flow has significantly increased by 964.90% to $28.24 million when compared to the same quarter last year. In addition, MAXYGEN INC has also vastly surpassed the industry average cash flow growth rate of 38.95%.

Maxygen, Inc., a biopharmaceutical company, engages in developing various products in the field of human therapeutics in North America. The company has a P/E ratio of 7.3, above the average diversified services industry P/E ratio of 3.6 and below the S&P 500 P/E ratio of 17.7. Maxygen has a market cap of $165.4 million and is part of the services sector and diversified services industry. Shares are up 6.9% year to date as of the close of trading on Monday.

You can view the full Maxygen 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.