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) -- Hornbeck Offshore Services (NYSE: HOS) 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, compelling growth in net income, good cash flow from operations, expanding profit margins and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
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- The revenue growth came in higher than the industry average of 2.5%. Since the same quarter one year prior, revenues rose by 20.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- 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 1098.8% when compared to the same quarter one year prior, rising from -$0.74 million to $7.40 million.
- Net operating cash flow has significantly increased by 2038.00% to $50.02 million when compared to the same quarter last year. In addition, HORNBECK OFFSHORE SVCS INC has also vastly surpassed the industry average cash flow growth rate of -80.17%.
- 42.30% is the gross profit margin for HORNBECK OFFSHORE SVCS 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 5.78% trails the industry average.
- HOS's debt-to-equity ratio of 0.94 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 7.53 is very high and demonstrates very strong liquidity.
-- Written by a member of TheStreet Ratings Staff