Leucadia National Corporation Stock Upgraded (LUK)

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) -- Leucadia National Corporation (NYSE: LUK) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, good cash flow from operations and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

  • EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stocks Under $10 that he thinks could potentially double. See what he's trading today with a 14-day FREE pass.

Highlights from the ratings report include:
  • LUK's very impressive revenue growth greatly exceeded the industry average of 2.8%. Since the same quarter one year prior, revenues leaped by 995.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • LUK's debt-to-equity ratio is very low at 0.28 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.13, which illustrates the ability to avoid short-term cash problems.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Diversified Financial Services industry. The net income increased by 136.7% when compared to the same quarter one year prior, rising from -$291.02 million to $106.67 million.
  • Net operating cash flow has significantly increased by 850.75% to $199.94 million when compared to the same quarter last year. In addition, LEUCADIA NATIONAL CORP has also vastly surpassed the industry average cash flow growth rate of -154.16%.
.

Leucadia National Corporation engages in beef processing, manufacturing, gaming entertainment, real estate activities, medical product development, and winery operations in the United States and internationally. The company has a P/E ratio of 11.2, below the S&P 500 P/E ratio of 17.7. Leucadia has a market cap of $5.79 billion and is part of the conglomerates sector and conglomerates industry. Shares are up 6.7% year to date as of the close of trading on Wednesday.

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

-- Written by a member of TheStreet Ratings Staff

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.

Holiday Special: Subscribe to Action Alerts PLUS to see how Jim Cramer trades his $2.5 Million+ portfolio for 51% off the list price. Your first 14-days are FREE: Sign up today to get e-mail alerts before every trade.
null

If you liked this article you might like

An Activist Could Push 'Other Berkshire Hathaway' To Sell Beef Unit

These Stocks Are Changing Direction

Verizon a Tremendous Value Despite Earnings Miss, Says GoodHaven Manager

Wall Street `Repo' Hub Targets Pensions, Insurers in Expansion Plan