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) -- RTI Biologics (Nasdaq: RTIX) 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, good cash flow from operations, expanding profit margins, increase in net income and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
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- RTIX's revenue growth has slightly outpaced the industry average of 4.2%. Since the same quarter one year prior, revenues slightly increased by 5.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
- Net operating cash flow has increased to $8.12 million or 10.90% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -2.54%.
- RTI BIOLOGICS INC reported flat earnings per share in the most recent 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, RTI BIOLOGICS INC turned its bottom line around by earning $0.15 versus -$2.36 in the prior year. This year, the market expects an improvement in earnings ($0.18 versus $0.15).
- The gross profit margin for RTI BIOLOGICS INC is rather high; currently it is at 53.20%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, RTIX's net profit margin of 6.30% significantly trails the industry average.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Health Care Equipment & Supplies industry average. The net income increased by 2.4% when compared to the same quarter one year prior, going from $2.74 million to $2.81 million.
-- Written by a member of TheStreet Ratings Staff