Mead Johnson Nutrition Company Stock Buy Recommendation Reiterated (MJN)

NEW YORK ( TheStreet) -- Mead Johnson Nutrition Company (NYSE: MJN) 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 notable return on equity, expanding profit margins, good cash flow from operations, growth in earnings per share and revenue growth. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • Compared to other companies in the Food Products industry and the overall market, MEAD JOHNSON NUTRITION CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for MEAD JOHNSON NUTRITION CO is rather high; currently it is at 64.30%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 16.62% is above that of the industry average.
  • Net operating cash flow has significantly increased by 971.64% to $207.90 million when compared to the same quarter last year. In addition, MEAD JOHNSON NUTRITION CO has also vastly surpassed the industry average cash flow growth rate of 113.27%.
  • MEAD JOHNSON NUTRITION CO has improved earnings per share by 6.3% 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. We feel that this trend should continue. During the past fiscal year, MEAD JOHNSON NUTRITION CO increased its bottom line by earning $2.96 versus $2.47 in the prior year. This year, the market expects an improvement in earnings ($3.26 versus $2.96).
  • MJN's revenue growth trails the industry average of 22.1%. Since the same quarter one year prior, revenues slightly increased by 5.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.

Mead Johnson Nutrition Company manufactures, distributes, and sells infant formulas, children's nutrition, and other nutritional products. Mead Johnson Nutrition has a market cap of $15.9 billion and is part of the consumer goods sector and food & beverage industry. The company has a P/E ratio of 27.00, above the S&P 500 P/E ratio of 18.00. Shares are up 20.2% year to date as of the close of trading on Friday.

You can view the full Mead Johnson Nutrition Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
null

If you liked this article you might like

McCormick in $4.2 Billion Play for Reckitt Benckiser's Food Division

Reckitt Wrecked By Petya Virus

Reckitt Benckiser Says Petya Cyber Attack Will Slam Q2 Revenues

Reckitt to Close $18 Billion Mead Johnson Takeover Deal June 15