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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- 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).
-- Written by a member of TheStreet Ratings Staff