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) -- IRIS International (Nasdaq: IRIS) 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, largely solid financial position with reasonable debt levels by most measures, increase in net income, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
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- IRIS's revenue growth has slightly outpaced the industry average of 5.9%. Since the same quarter one year prior, revenues slightly increased by 2.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- IRIS 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 2.66, which clearly demonstrates the ability to cover short-term cash needs.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Health Care Equipment & Supplies industry. The net income increased by 452.0% when compared to the same quarter one year prior, rising from -$0.34 million to $1.21 million.
- Net operating cash flow has significantly increased by 289.41% to $3.01 million when compared to the same quarter last year. In addition, IRIS INTERNATIONAL INC has also vastly surpassed the industry average cash flow growth rate of 13.55%.
- The gross profit margin for IRIS INTERNATIONAL INC is rather high; currently it is at 58.30%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, IRIS's net profit margin of 3.90% significantly trails the industry average.
-- Written by a member of TheStreet Ratings Staff