Delhaize Group SA Stock Upgraded (DEG)

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) -- Delhaize Group (NYSE: DEG) 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, 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.

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Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 7.5%. Since the same quarter one year prior, revenues rose by 26.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.56, is low and is below the industry average, implying that there has been successful management of debt levels.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Food & Staples Retailing industry. The net income increased by 60.1% when compared to the same quarter one year prior, rising from $152.77 million to $244.56 million.
  • Net operating cash flow has significantly increased by 150.62% to $490.50 million when compared to the same quarter last year. In addition, DELHAIZE GROUP - ETS DLHZ FR has also vastly surpassed the industry average cash flow growth rate of 42.56%.
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Etablissements Delhaize Freres et Cie 'Le Lion' (Groupe Delhaize) SA, together with its subsidiaries, engages in the operation of food supermarkets in the United States, Belgium, southeastern Europe, and Asia. It also operates other store formats, such as proximity stores. The company has a P/E ratio of 8.2, below the S&P 500 P/E ratio of 17.7. Delhaize Group has a market cap of $4.97 billion and is part of the services sector and retail industry. Shares are up 21.7% year to date as of the close of trading on Tuesday.

You can view the full Delhaize Group 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.

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