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) -- Pharmacyclics Incorporated (Nasdaq: PCYC) 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, notable return on equity, expanding profit margins and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
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- PCYC's very impressive revenue growth greatly exceeded the industry average of 2.7%. Since the same quarter one year prior, revenues leaped by 277454.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- PCYC has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 11.42, which clearly demonstrates the ability to cover short-term cash needs.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Biotechnology industry and the overall market, PHARMACYCLICS INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- The gross profit margin for PHARMACYCLICS INC is currently very high, coming in at 76.90%. It has increased significantly from the same period last year. Along with this, the net profit margin of 73.62% significantly outperformed against the industry average.
- Net operating cash flow has significantly increased by 825.21% to $81.00 million when compared to the same quarter last year. In addition, PHARMACYCLICS INC has also vastly surpassed the industry average cash flow growth rate of -60.52%.
-- Written by a member of TheStreet Ratings Staff