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) -- EMC Corporation (NYSE: EMC) has been reiterated by TheStreet Ratings as a buy with a ratings score of B . The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, growth in earnings per share, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
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- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Computers & Peripherals industry average. The net income increased by 4.5% when compared to the same quarter one year prior, going from $832.05 million to $869.92 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 18.0%. Since the same quarter one year prior, revenues slightly increased by 8.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- EMC CORP/MA's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, EMC CORP/MA increased its bottom line by earning $1.23 versus $1.10 in the prior year. This year, the market expects an improvement in earnings ($1.86 versus $1.23).
- The gross profit margin for EMC CORP/MA is currently very high, coming in at 71.20%. 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 14.42% trails the industry average.
- Although EMC's debt-to-equity ratio of 0.07 is very low, it is currently higher than that of the industry average. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.94 is somewhat weak and could be cause for future problems.
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