Rating Change #3

MetroPCS Communications Inc ( PCS) 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, increase in stock price during the past year, attractive valuation levels, compelling growth in net income and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

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Highlights from the ratings report include:
  • PCS's revenue growth has slightly outpaced the industry average of 0.9%. Since the same quarter one year prior, revenues slightly increased by 5.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The strong earnings growth this company has enjoyed -- up -- has apparently played a role in driving up its share price by a solid 26.67%. In addition, the rise in the general market has likely contributed to this stock's strong performance during this past year.Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Wireless Telecommunication Services industry. The net income increased by 76.5% when compared to the same quarter one year prior, rising from $84.34 million to $148.84 million.
  • 49.70% is the gross profit margin for METROPCS COMMUNICATIONS INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 11.60% trails the industry average.

MetroPCS Communications, Inc., a wireless telecommunications carrier, together with its subsidiaries, provides wireless broadband mobile services in the United States. The company has a P/E ratio of 13.1, above the average telecommunications industry P/E ratio of 12.9 and below the S&P 500 P/E ratio of 17.7. MetroPCS has a market cap of $4.28 billion and is part of the technology sector and telecommunications industry. Shares are up 35.7% year to date as of the close of trading on Wednesday.

You can view the full MetroPCS Ratings Report or get investment ideas from our investment research center.

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