Editor's Note: 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 NEW YORK ( TheStreet) -- KVH Industries (Nasdaq: KVHI) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and solid stock price performance. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
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- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Communications Equipment industry. The net income increased by 138.4% when compared to the same quarter one year prior, rising from $0.19 million to $0.45 million.
- KVHI's revenue growth trails the industry average of 16.2%. Since the same quarter one year prior, revenues slightly increased by 4.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Although KVHI's debt-to-equity ratio of 0.11 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 2.94, which clearly demonstrates the ability to cover short-term cash needs.
- Net operating cash flow has significantly increased by 514.85% to $1.70 million when compared to the same quarter last year. In addition, KVH INDUSTRIES INC has also vastly surpassed the industry average cash flow growth rate of -8.73%.
- Powered by its strong earnings growth of 200.00% and other important driving factors, this stock has surged by 64.57% over the past year, outperforming the rise in the S&P 500 Index during the same period. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
-- Written by a member of TheStreet Ratings Staff