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) -- AmeriGas Partners (NYSE: APU) 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, expanding profit margins, increase in net income and growth in earnings per share. 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 10.1%. Since the same quarter one year prior, revenues rose by 28.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
- 48.40% is the gross profit margin for AMERIGAS PARTNERS -LP which we consider to be strong. It has increased significantly from the same period last year. Along with this, the net profit margin of 11.02% is above that of the industry average.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Gas Utilities industry. The net income increased by 127.3% when compared to the same quarter one year prior, rising from $42.53 million to $96.67 million.
- AMERIGAS PARTNERS -LP 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, AMERIGAS PARTNERS -LP swung to a loss, reporting -$0.05 versus $1.51 in the prior year. This year, the market expects an improvement in earnings ($2.50 versus -$0.05).
- In its most recent trading session, APU has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
-- Written by a member of TheStreet Ratings Staff