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) -- Seacor Holdings (NYSE: CKH) 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, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures, growth in earnings per share and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
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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 Energy Equipment & Services industry. The net income increased by 322.1% when compared to the same quarter one year prior, rising from $3.82 million to $16.10 million.
- Net operating cash flow has significantly increased by 57.19% to $54.64 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 15.73%.
- Despite currently having a low debt-to-equity ratio of 0.55, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that CKH's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.62 is high and demonstrates strong liquidity.
- SEACOR HOLDINGS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. 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, SEACOR HOLDINGS INC reported lower earnings of $1.57 versus $11.50 in the prior year. This year, the market expects an improvement in earnings ($2.92 versus $1.57).
- CKH, with its decline in revenue, underperformed when compared the industry average of 11.3%. Since the same quarter one year prior, revenues fell by 15.2%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
-- Written by a member of TheStreet Ratings Staff