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) -- OmniVision Technologies (Nasdaq: OVTI) 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, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, increase in net income and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
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- OVTI's very impressive revenue growth greatly exceeded the industry average of 15.4%. Since the same quarter one year prior, revenues leaped by 53.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- OVTI's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, OVTI has a quick ratio of 1.51, which demonstrates the ability of the company to cover short-term liquidity needs.
- Powered by its strong earnings growth of 240.00% and other important driving factors, this stock has surged by 28.92% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, OVTI should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 232.8% when compared to the same quarter one year prior, rising from $2.68 million to $8.92 million.
- OMNIVISION TECHNOLOGIES INC 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, OMNIVISION TECHNOLOGIES INC reported lower earnings of $0.80 versus $1.08 in the prior year. This year, the market expects an improvement in earnings ($1.70 versus $0.80).
-- Written by a member of TheStreet Ratings Staff