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) -- Marten Transport (Nasdaq: MRTN) 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, attractive valuation levels, increase in net income and increase in stock price during the past year. We feel these strengths outweigh the fact that the company shows low profit margins.
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- Despite its growing revenue, the company underperformed as compared with the industry average of 7.2%. Since the same quarter one year prior, revenues slightly increased by 5.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
- MRTN's debt-to-equity ratio is very low at 0.01 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, MRTN has a quick ratio of 1.64, which demonstrates the ability of the company to cover short-term liquidity needs.
- MARTEN TRANSPORT LTD 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, MARTEN TRANSPORT LTD increased its bottom line by earning $1.23 versus $1.11 in the prior year. This year, the market expects an improvement in earnings ($1.35 versus $1.23).
- 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 Road & Rail industry average. The net income increased by 0.7% when compared to the same quarter one year prior, going from $7.66 million to $7.72 million.
-- Written by a member of TheStreet Ratings Staff