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) -- International Paper (NYSE: IP) has been reiterated by TheStreet Ratings as a buy with a ratings score of A-. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, solid stock price performance and growth in earnings per share. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
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- The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Paper & Forest Products industry average. The net income increased by 69.1% when compared to the same quarter one year prior, rising from $188.00 million to $318.00 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 9.9%. Since the same quarter one year prior, revenues slightly increased by 6.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Powered by its strong earnings growth of 54.76% and other important driving factors, this stock has surged by 54.33% over the past year, outperforming the rise in the S&P 500 Index during the same period. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- INTL PAPER CO 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, INTL PAPER CO reported lower earnings of $1.71 versus $2.94 in the prior year. This year, the market expects an improvement in earnings ($3.55 versus $1.71).
- The gross profit margin for INTL PAPER CO is rather low; currently it is at 19.70%. Regardless of IP's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, IP's net profit margin of 4.48% compares favorably to the industry average.
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