Express Inc. Stock Upgraded (EXPR)

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) -- Express (NYSE: EXPR) 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, attractive valuation levels, good cash flow from operations, expanding profit margins 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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Highlights from the ratings report include:
  • EXPR's revenue growth trails the industry average of 26.4%. Since the same quarter one year prior, revenues slightly increased by 8.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Net operating cash flow has increased to $180.22 million or 21.55% when compared to the same quarter last year. Despite an increase in cash flow, EXPRESS INC's cash flow growth rate is still lower than the industry average growth rate of 42.82%.
  • 37.40% is the gross profit margin for EXPRESS INC which we consider to be strong. Regardless of EXPR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, EXPR's net profit margin of 8.77% compares favorably to the industry average.
  • EXPRESS INC has improved earnings per share by 10.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, EXPRESS INC increased its bottom line by earning $1.60 versus $1.58 in the prior year. For the next year, the market is expecting a contraction of 4.4% in earnings ($1.53 versus $1.60).
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Express, Inc. operates as a specialty apparel and accessory retailer primarily in the United States. Its stores provide apparel and accessories for women and men between 20 and 30 years old across various aspects of the lifestyles comprising work, casual, jeanswear, and going-out occasions. The company has a P/E ratio of 11.9, below the S&P 500 P/E ratio of 17.7. Express has a market cap of $1.62 billion and is part of the services sector and retail industry. Shares are up 26.1% year to date as of the close of trading on Tuesday.

You can view the full Express 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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